EXHIBIT 10.5
                              EMPLOYMENT AGREEMENT


     THIS  AGREEMENT  is made and  entered  into as of August 24,  1998  between
PAYLESS CASHWAYS,  INC., a Delaware  corporation (the "Company"),  and LOUISE R.
IENNACCARO (the "Executive").

     WHEREAS,  the Company  desires to employ the  Executive  in the capacity of
Vice President - Human  Resources,  and the Executive  desires to be employed by
the Company in such capacity and on the terms and  conditions  set forth in this
Agreement;

     NOW,  THEREFORE,  in  consideration  of the mutual covenants of the parties
herein made, it is hereby agreed:

     1.  Term of  Agreement.  The  term of this  Agreement  shall  be one  year,
commencing  August 24, 1998 and ending August 24, 1999, unless sooner terminated
as  provided in  Paragraph  6 of this  Agreement;  PROVIDED,  however,  that the
Agreement shall be automatically  renewed for an additional term of one year, at
the end of the  initial  one-year  term and of each  succeeding  one-year  term,
unless  either the Company or the  Executive  shall serve notice on the other at
least ninety (90) days prior to the  expiration of the term, in accordance  with
the procedures set out in Paragraph 12 of this Agreement,  that the party giving
notice intends to end the Agreement at the conclusion of the then-current  term.
The Company shall not be required to show Cause,  and the Executive shall not be
required to show Good Reason,  to require the expiration of the Agreement  under
the terms of this Paragraph.

     2.  Employment  and  Duties.  The  Company  hereby  agrees  to  employ  the
Executive,  and the Executive hereby accepts employment,  to perform such duties
and  responsibilities  of Vice President - Human  Resources as are, from time to
time,  assigned to the Executive by the Board of Directors or its designee.  The
Executive  agrees to devote full  business  time and effort to the  diligent and
faithful  performance  of the  Executive's  duties  under the  direction of such
person as is designated by the Company's Board of Directors.

     3. Compensation.

          (a) Base Salary.  As compensation  for the Executive's  services,  the
Executive  shall be paid a base  salary at a  minimum  annual  rate of  $135,000
payable in equal bi-weekly installments, which salary shall be reviewed annually
and  may be  adjusted  from  time  to time at the  discretion  of the  Board  of
Directors (the "Base  Salary");  provided that the Base Salary shall not be less
than the amount stated in this Paragraph 3(a).

          (b) Incentive  Compensation.  The Executive  shall, in addition to the
Base  Salary,  also be  eligible  to receive  incentive  compensation  under the
Company's management and


<PAGE>2

executive  incentive  compensation  program  or such  other  program or plan for
officers  of the  Company  as may be from time to time in  effect,  if any,  the
existence and terms of which shall be determined solely at the discretion of the
Compensation Committee of the Board of Directors (the "Incentive Compensation").

          (c) Other Benefits.  The Executive shall be entitled to participate in
the Company's regular health,  life,  pension,  vacation and disability plans in
accordance with their  respective  terms. The Company will also provide employee
benefits  to the  Executive  in respect  of the  Executive's  employment  as the
Company customarily  provides,  from time to time, to its officers, as described
in Exhibit A attached to this  Agreement.  Nothing  herein shall be construed to
limit the Company's discretion to amend,  terminate or otherwise modify any such
plans or benefits,  subject to the Executive's rights under Paragraph  6(c)(iii)
below.

     4. Confidentiality, Non-Solicitation, and Non-Disparagement.

          (a) Confidentiality of Proprietary  Information.  The Executive agrees
that, at all times, both during the Executive's  employment with the Company and
after the expiration or termination  thereof for any reason, the Executive shall
not divulge to any person, firm, corporation, or other entity, or in any way use
for the  Executive's  own  benefit,  except as  required  in the  conduct of the
Company's  business or as  authorized  in writing on behalf of the Company,  any
trade  secrets  or  confidential  information  (the  "Proprietary  Information")
obtained during the course of the Executive's  employment with the Company.  The
Proprietary  Information  includes,  but is not limited  to,  customer or client
lists  (including  the  names  and/or  positions  of  persons  employed  by such
customers  or clients  who play a role in the  decisions  of such  customers  or
clients  concerning  products or services of the type  provided by the Company),
financial  matters,  inventory  techniques  and  programs,  Company  records  of
accounts,  business  projections,  Company  contracts,  sales,  merchandising or
marketing  plans and  strategies,  pricing  information  and  formulas,  matters
contained in unpublished records and correspondence,  planned expansion programs
(including  areas of expansion  and  potential  customer  lists) and any and all
information concerning the business or affairs of the Company which is not known
by or generally  available  to the public.  All papers and records of every kind
relating to the Proprietary  Information,  including any such papers and records
which shall at any time come into the possession of the Executive,  shall be the
sole and  exclusive  property  of the Company  and shall be  surrendered  to the
Company upon  termination of the  Executive's  employment for any reason or upon
request by the Company at any time  either  during or after the  termination  of
such  employment.  All  information  relating  to or owned by  customers  of the
Company of which the Executive becomes aware or with which the Executive becomes
familiar  through the  Executive's  employment  with the  Company  shall be kept
confidential  and not disclosed to others or used by the  Executive  directly or
indirectly  except in the course of the  Company's  business.  It is agreed that
Proprietary  Information as herein  described shall be protected from disclosure
under the terms of this  Agreement,  to the  maximum  extent  permitted  by law,
whether or not entitled to protection as a trade secret.



<PAGE>3


          (b) Solicitation  Prohibition.  During the Executive's employment with
the Company and for a period of one (1) year after the expiration or termination
of this  Agreement  or of the  Executive's  employment  with the Company for any
reason, the Executive shall not directly or indirectly, whether as an individual
for the  Executive's  own  account,  or on  behalf of any  other  person,  firm,
corporation,  partnership,  joint  venture  or  entity  whatsoever,  solicit  or
endeavor to entice away from the  Company  any  employee  who is employed by the
Company.   Additionally,   the  Executive  shall  not,  during  the  Executive's
employment with the Company or for a period of one (1) year after the expiration
or termination of this Agreement or of Executive's  employment  with the Company
for any reason,  directly or indirectly  through any other individual or entity,
solicit  the  business  of any  customer of the  Company,  or  solicit,  entice,
persuade or induce any individual or entity to terminate, reduce or refrain from
forming, renewing or extending its relationship,  whether actual or prospective,
with the Company.

          (c) Disparagement  Prohibition.  The Executive acknowledges and agrees
that as a result of his  position  with the  Company,  disparaging  or  critical
statements  made by the Executive may be uniquely  detrimental  to the Company's
interests  and  well-being.  Therefore,  the  Executive  agrees  to use his best
efforts to assist the  Company in  promoting  and  preserving  the good will and
other business  interests of the Company.  To this end, the Executive  agrees to
refrain  at all times,  both  during the  Executive's  employment  and after the
termination thereof for any reason, from making disparaging  comments or remarks
about the Company or its officers, employees, or directors.

          (d) Definition of "Company". For the purposes of Paragraph 4, the term
"Company"  shall mean the Company  and any of its direct or  indirect  parent or
subsidiary organizations.

     5.  Covenant Not to Compete.  During the  Executive's  employment  with the
Company and for a period of one year after the expiration or termination of this
Agreement or of the Executive's employment with the Company (the "Noncompetition
Period"), if such termination is as a result of the expiration of this Agreement
under  Paragraph  6(h), a  termination  for Good Reason by the  Executive  under
Paragraph  6(c), or a termination by the Company  without Cause under  Paragraph
6(d),  the  Executive  agrees  not to act as an owner or  operator,  officer  or
director, employee,  consultant or agent of any other person, firm, corporation,
partnership,  joint  venture or other entity which is engaged in the business of
building materials retailing in any state in which the Company is so engaged, or
has plans to be so  engaged  during the  Noncompetition  Period.  The  foregoing
provisions  shall not prohibit the Executive from investing in any securities of
any  corporation  whose  securities,  or any of them,  are  listed on a national
securities  exchange or traded in the  over-the-counter  market if the Executive
shall own less  than one  percent  1% of the  outstanding  voting  stock of such
corporation.  The  Executive  agrees  that a breach of the  covenants  contained
herein will result in irreparable and continuing damage to the Company for which
there will be no adequate  remedy at law, and in the event of any breach of such
agreement,  the  Company  shall be  entitled  to  injunctive  and such other and
further relief, including damages, attorneys' fees, and litigation costs, as may
be proper.


<PAGE>4


     6. Termination.

          (a) Death or Disability.  In the event of the Executive's  death or if
the Executive  should  become  unable to perform the essential  functions of the
position  of Vice  President  - Human  Resources,  with  or  without  reasonable
accommodation by the Company,  this Agreement,  and the Company's  obligation to
make further Base Salary  payments under the  Agreement,  shall  terminate,  and
Executive shall not be entitled to receive severance  benefits.  Executive shall
be  entitled to receive  any  Incentive  Compensation  which the  Executive  has
earned,  if any,  prorated  to the date of the  termination  of the  Executive's
employment by reason of death or the date of termination,  due to disability, of
Executive's   performance  as  Vice  President  -  Human  Resources  under  this
Agreement.  The Executive's  rights to other  compensation and benefits shall be
determined  under  the  Company's  benefit  plans  and  policies  applicable  to
Executive then in effect.

          (b) Termination  for Cause by the Company.  By following the procedure
set forth in Paragraph  6(e) the Company shall have the right to terminate  this
Agreement  and  the  employment  of the  Executive  for  "Cause"  in  the  event
Executive:

                    (i) has committed a significant act of dishonesty, deceit or
          breach of fiduciary duty in the performance of the Executive's  duties
          as an employee of the Company;

                    (ii) has  neglected or failed to perform  substantially  the
          duties of the Executive's  employment under this Agreement,  including
          but not limited to an act of insubordination;

                    (iii)  has  acted or  failed  to act in any  other  way that
          reflects materially and adversely upon the Company,  including but not
          limited to the Executive's conviction of, guilty plea, or plea of nolo
          contendere  to (A) any  felony,  or any  misdemeanor  involving  moral
          turpitude,  or (B) any  crime or  offense  involving  dishonesty  with
          respect to the Company; or

                    (iv) has  knowingly  failed  to  comply  with the  covenants
          contained in Paragraphs 4 or 5 of this Agreement.

          If the  employment  of the  Executive is terminated by the Company for
Cause,  this Agreement and the Company's  obligation to make further Base Salary
and  Incentive  Compensation  payments  hereunder  shall  thereupon  immediately
terminate,  and  the  Executive  shall  not be  entitled  to  receive  severance
benefits.  The Executive's  rights to other  compensation  and benefits shall be
determined  under the  Company's  benefit  plans and policies  applicable to the
Executive then in effect.



<PAGE>5


          (c)  Termination  for Good Reason by the  Executive.  By following the
procedure set forth in Paragraph  6(e),  the  Executive  shall have the right to
terminate this  Agreement and the  Executive's  employment  with the Company for
"Good Reason" in the event:

                    (i) the  Executive  is not at all times a duly  elected Vice
          President - Human Resources of the Company;

                    (ii)  there is any  material  reduction  in the scope of the
          Executive's  authority and responsibility  (provided,  however, in the
          event of any  illness or injury  which  prevents  the  Executive  from
          performing the Executive's  duties, Good Reason shall not exist if the
          Company  reassigns  the  Executive's  duties  to  one  or  more  other
          employees until the Executive is able to perform such duties);

                    (iii) there is a reduction  in the  Executive's  Base Salary
          below the minimum amount specified in Paragraph 3(a) above; a material
          reduction in the Incentive Compensation  opportunity of the Executive,
          if any,  under  Paragraph 3(b) above;  or a material  reduction in the
          other  benefits to which  Executive is entitled  under  Paragraph 3(c)
          above, as compared to the benefits  available to Executive at the time
          of execution of this Agreement.

                    (iv) the Company requires the Executive's principal place of
          employment  be relocated  fifty (50) miles from its location as of the
          date of this Agreement;

                    (v) the  Company  otherwise  fails to perform  its  material
          obligations under this Agreement.

     If the  employment of the Executive is terminated by the Executive for Good
Reason,  the Executive shall be entitled to the severance  benefits set forth in
Paragraph 6(f) below,  but the Company's  obligation to make further Base Salary
payments and incentive  compensation  payments shall cease on the effective date
of such termination.  The Executive's  rights to other compensation and benefits
shall be determined under the Company's benefit plans and policies applicable to
the Executive then in effect.

          (d) Termination  Without Cause or Without Good Reason. The Company may
terminate this  Agreement and the  Executive's  employment  without Cause at any
time,  and in such  event  the  Executive  shall be  entitled  to the  severance
benefits  set forth in  Paragraph  6(f) below.  The  Executive  may  voluntarily
terminate this Agreement and the Executive's  employment  without Good Reason at
any time, but in such event the Executive shall not be entitled to the severance
benefits  set  forth in  Paragraph  6(f)  below.  If the  Executive  voluntarily
terminates this Agreement and the Executive's employment without Good Reason, or
if the Company terminates this Agreement and the Executive's  employment without
Cause,  then the Company's  obligation to make further Base Salary  payments and
Incentive  Compensation  payments  shall  cease  on the  effective  date of such
termination. The Executive's rights to other compensation and benefits shall

<PAGE>6

be determined under the Company's  benefit plans and policies  applicable to the
Executive then in effect.

          (e) Notice and Right to Cure.  The party  proposing to terminate  this
Agreement and the  employment of the Executive for Cause or Good Reason,  as the
case may be, under Paragraph 6(b) or 6(c) above shall give written notice to the
other,  specifying  the reason  therefor  with  particularity.  In the case of a
termination  pursuant to Paragraphs  6(b)(i),  (iii) or (iv),  or 6(c)(i),  such
termination shall be effective  immediately upon delivery of such notice. In the
case of any other proposed termination for Cause or Good Reason, as the case may
be, the notice shall be given with  sufficient  particularity  so that the other
party  will  have  an  opportunity  to  correct  any  curable  situation  to the
reasonable satisfaction of the party giving the notice within the period of time
specified in the notice,  which shall not be less than thirty (30) days. If such
correction is not so made or the circumstances or situation are not curable, the
party giving such notice may,  within  thirty (30) days after the  expiration of
the time fixed to correct such situation, give written notice to the other party
that the  employment is  terminated  as of the date of that  writing.  Where the
Agreement and the Executive's employment are terminated by the Executive without
Good Reason or by the Company without Cause,  the termination  date shall be the
date on which  notification  of termination  shall be mailed in accordance  with
Paragraph 12 of this  Agreement,  unless a different  termination  date shall be
designated  by the party giving  notice or agreed upon by the  Executive and the
Company.

          (f)  Severance  Benefits.   If  this  Agreement  and  the  Executive's
employment with the Company are terminated by reason of the Executive's death or
disability, or by the Company with Cause or by the Executive without Good Reason
then the Executive  shall receive no severance  benefits.  If this Agreement and
the Executive's employment with the Company are terminated due to the expiration
of the Agreement,  by the Company  without  Cause,  or by the Executive for Good
Reason,  then the  Executive  shall be entitled to the  following  benefits (the
"Severance Benefits"):

                    (i) Base Salary.  The Company  shall  continue to pay to the
          Executive  the  Executive's  Base  Salary for a period of one (1) year
          after  the  date  the  Executive's  employment  with  the  Company  is
          terminated  (the  "Severance  Period"),  when and as such Base  Salary
          would have been paid, and as if the Executive continued to be employed
          during such period and  regardless  of the death or  disability of the
          Executive after the date of termination.

                    (ii) Incentive  Compensation.  In the event the Compensation
          Committee  of  the  Board  of  Directors   determines  that  Incentive
          Compensation  is to be  paid  in the  year in  which  the  Executive's
          employment and this Agreement are terminated  under  circumstances  in
          which this Agreement  provides for the payment of Severance  Benefits,
          then the Executive will receive  Incentive  Compensation  prorated for
          the time during which services were rendered in the year of

<PAGE>7

     termination,  to the extent provided by the Compensation  Committee for the
     calculation of Incentive Compensation for that year.

                    (iii) Continuation of Benefits. During the Severance Period,
          the Company shall provide the Executive with medical,  dental, vision,
          and regular and  supplemental  life insurance  coverage  substantially
          similar to the coverage  which the Executive was receiving or entitled
          to receive  immediately  prior to the date of the  termination  of the
          Executive's employment.  In addition, during the Severance Period, the
          Company  shall pay on behalf of the  Executive  the cost of one annual
          physical   examination   and  the  cost  of  the  preparation  of  the
          Executive's  federal,  state and local tax returns in accordance  with
          the  terms  set out in  Exhibit  A. The  Company  shall  provide  such
          benefits  to the  Executive  at Company  expense,  subject to the same
          cost-sharing   provisions,   if  any,   applicable  to  the  Executive
          immediately  prior  to the  date  of the  termination  of  employment.
          Notwithstanding the foregoing,  the Executive shall not be entitled to
          receive such benefits to the extent that the  Executive  obtains other
          employment  which provides  comparable  benefits  during the Severance
          Period.

                    (iv)  Outplacement  Benefits.  The Company,  at its expense,
          will provide to the Executive outplacement services, at a maximum cost
          of  $30,000,  to be  provided  by  an  outplacement  service  provider
          selected solely by the Company.

                    (v)  Termination  of  Benefits.  Notwithstanding  any  other
          provision of this  Agreement,  in the event that the  Executive at any
          time violates the provisions of Paragraph  4(a),  4(b),  4(c), or 5 of
          this  Agreement,  then the Company's  obligations,  if any, to provide
          base salary  continuation  and other severance  benefits as set out in
          Paragraph  6(f) of this Agreement  shall cease,  and such payments and
          benefits shall immediately cease.

          (g) Change of Control.  Subject to the Executive's compliance with the
terms and conditions of this Agreement,  if during the term of the Agreement the
Executive's  employment is  terminated  without Cause as a result of a Change of
Control (as defined below) of the Company, and if the Executive is not offered a
comparable position by the Company,  then the Severance Period shall be extended
to the second anniversary of the date of the termination of employment,  and the
Executive shall be entitled to receive continued  payments of Base Salary during
the second year of the  Severance  Period.  All  Severance  Benefits  other than
continued  payments of Base Salary shall cease on the first  anniversary  of the
termination  of employment in the event of a Change in Control.  For purposes of
this Paragraph 6(g), a Change in Control shall mean:

                    (i) The acquisition by any person, entity or "group," within
          the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
          Act of 1934 (the "Exchange Act") (excluding, for this purpose, (A) the
          Company or its  subsidiaries  or (B) any employee  benefit plan of the
          Company or its subsidiaries which acquires

<PAGE>8

          beneficial  ownership  of  voting  securities  of  the  Company),   of
          beneficial  ownership  (within the  meaning of Rule 13d-3  promulgated
          under the Exchange Act) of thirty  percent (30%) or more of either the
          then  outstanding  shares of common stock or the combined voting power
          of the Company's then outstanding  voting securities  entitled to vote
          generally in the election of directors; or

                    (ii)  During  any  period  of  two  consecutive  years  (not
          including  any  period  prior  to the  execution  of this  Agreement),
          individuals  who at the  beginning  of  such  period  constituted  the
          Company's  Board of  Directors  (as of the date hereof the  "Incumbent
          Board")  cease for any reason to constitute at least a majority of the
          Board,  provided that any person becoming a director subsequent to the
          date  hereof  whose  election,  or  nomination  for  election  by  the
          Company's stockholders,  was approved by a vote of at least a majority
          of the directors then  comprising the then Incumbent Board (other than
          an election or nomination of an individual whose initial assumption of
          office is in connection with an actual or threatened  election contest
          relating to the  election of the  Directors  of the  Company,  as such
          terms are used in Rule 14a-11 of Regulation 14A promulgated  under the
          Exchange Act) shall be, for purposes of this Agreement,  considered as
          though such person were a member of the Incumbent Board; or

                    (iii) Approval by the  stockholders  of the Company of (A) a
          reorganization, merger, or consolidation of the Company with any other
          company other than (I) a  reorganization,  merger, or consolidation in
          which  persons who were the  stockholders  of the company  immediately
          prior to such  reorganization,  merger, or consolidation,  immediately
          thereafter,  own more than fifty percent (50%) of the combined  voting
          power of the  reorganized,  merged,  or  consolidated  company's  then
          outstanding  voting securities,  or (II) a reorganization,  merger, or
          consolidation  effected to implement a recapitalization of the Company
          (or  similar  transaction)  in which no  "person"  acquires  more than
          thirty  percent  (30%) of the combined  voting power of the  Company's
          then  outstanding  securities;  or (B) a liquidation or dissolution of
          the Company; or (C) the sale of all or substantially all of the assets
          of the Company.

          (h) Expiration of Term of Agreement.  At the expiration of the term of
this  Agreement as defined in Paragraph 1 above,  if the  Agreement has not been
previously  terminated  under Paragraph 6(a), (b), (c) or (d) of this Agreement,
all duties and obligations of the parties under this Agreement, except those set
out in Paragraphs 4, 5 and 6(f), when applicable, shall cease.

          (i) Survival of Certain Provisions.  Notwithstanding the expiration or
termination of this Agreement,  and the Executive's  employment with the Company
for any reason under this Agreement, the provisions of Paragraphs 4, 5 and 6(f),
when applicable, to the extent

<PAGE>9

provided  therein,  survive any such  termination  and shall be binding upon the
Executive and the Company in accordance  with the  provisions of Paragraphs 4, 5
and 6(f).

          (j)  Participation in Retention Plan. The Executive shall  participate
in the  Reorganization  Retention  Plan  adopted by the Company as of August 20,
1997, as amended, subject to the terms and conditions of such plan. For purposes
of  participation  in the  Reorganization  Retention  Plan,  Executive  shall be
considered a Participant with a separate  employment  agreement with the Company
and  thus  shall  not  be  a  Severance  Participant  under  the  terms  of  the
Reorganization Retention Plan.

          (k) Retention Payments Excluded from Severance. Any retention payments
paid pursuant to the terms of the August 20, 1997 Reorganization  Retention Plan
shall be excluded from the calculation of severance  payments provided for under
other Paragraphs of this Agreement.

     7.  Arbitration.  The parties  hereby agree that any dispute  arising under
this  Agreement or any claim for breach or  violation  of any  provision of this
Agreement shall be submitted to arbitration,  pursuant to the National Rules for
the Resolution of Employment  Disputes of the American  Arbitration  Association
("AAA"),  to a single arbitrator selected by mutual agreement of the parties or,
if the parties do not mutually agree on the  arbitrator,  in accordance with the
rules of the AAA. The award  determination  of the arbitrator shall be final and
binding upon the  parties.  Either party shall have the right to bring an action
in any court of competent  jurisdiction to enforce this Paragraph and to enforce
any arbitrator's  award rendered  pursuant to this Paragraph.  The venue for all
proceedings  in  arbitration   under  this  provision,   and  for  any  judicial
proceedings related to the arbitration, shall be in Kansas City, Missouri.

     8.  Business  Expenses.  The Company  shall  reimburse  the  Executive  for
entertainment  and  travel  expenses  related  to  the  Company's   business  in
accordance  with the policies of the Company  applicable to the Executive on the
date of this  Agreement,  subject  to the right of the  Company  to  modify  its
general policies relating to expense reimbursement for employees.

     9.  Severability.  If any one or more of the  provisions of this  Agreement
shall be held invalid or  unenforceable,  the remaining  provisions shall remain
valid and enforceable to the maximum extent permitted by law.

     10. Entire Agreement. This Agreement contains a statement of all agreements
and understandings  between the Executive and the Company on the subject matters
covered by the Agreement, and it replaces and supersedes all prior contracts and
agreements between the Executive and the Company concerning such matters.

     11. Binding  Effect.  This Agreement shall be binding upon and inure to the
benefit of the personal representatives,  heirs and assigns of the Executive and
to any successors in interest and assigns of the Company.


<PAGE>10


     12. Notices.  All notices required or permitted to be given hereunder shall
be registered or certified  mail  addressed to the  respective  parties at their
addresses set forth below:


         To the Executive:   Louise R. Iennaccaro
                             7909 N. Park
                             Kansas City, MO 64118

         To the Company:     Payless Cashways, Inc.
                             Two Pershing Square
                             2300 Main, P. 0. Box 419466
                             Kansas City, MO 64141-0466
                             Attn: Vice President - Human Resources

                             Blackwell Sanders Peper Martin LLP
                             Two Pershing Square
                             2300 Main, Suite 1000
                             Kansas City, MO 64108
                             Attn:  Gary Gilson

or such other address as a party hereto may notify the other in writing.

     13.  Applicable  Law.  This  Agreement,  or any portion  thereof,  shall be
interpreted in accordance with the laws of the State of Missouri.

     14.  Assignment.  The  rights and  obligations  of the  Company  under this
Agreement shall inure to the benefit of and shall be binding upon the successors
and  assigns  of the  Company.  Executive  may not  assign  any of his rights or
delegate  any of his duties or  obligations  under this  Agreement  without  the
Company's express written consent.

     15. Non-Waiver Provision.  The failure of either party of this Agreement to
insist upon strict adherence to any term of this Agreement,  or to object to any
failure to comply with any provision of this Agreement, shall not (a) constitute
or  operate as a waiver of that  terms or  provision,  (b) estop that party from
enforcing that term or provision, or (c) preclude that party from enforcing that
term or provision or any other term or provision. The receipt of a party to this
Agreement  of any  benefit  from this  Agreement  shall  not  effect a waiver or
estoppel of the right of that party to enforce any provision of this Agreement.

     16.  Golden  Parachute  Savings  Provision.  If,  in the  absence  of  this
provision,  any amount  received or to be received by the Executive  pursuant to
this Agreement would be subject to the "Excise Tax" imposed on "excess parachute
payments"  by  Section  4999  of  the  Internal  Revenue  Code  of  1986  or any
corresponding  provision of any later Federal tax law, the Company 

<PAGE>11

shall, in its reasonable  discretion,  reduce the amounts payable to the largest
amount that will result in elimination of any Excise Tax liability.



     IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and year first written above.



LOUISE R. IENNACCARO               PAYLESS CASHWAYS, INC.



/s/  Louise R. Iennaccaro          By: /s/ Millard E. Barron
--------------------------         ------------------------------------------
                                   Millard E. Barron, Chief Executive Officer