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                              EMPLOYMENT AGREEMENT


          THIS  AGREEMENT,  made  and  entered  into as of May 8,  1997  between
PAYLESS CASHWAYS, INC., an Iowa corporation (the "Company"), and STANLEY K. BOYD
(the "Executive").

         WHEREAS,  the Company desires to employ the Executive and the Executive
desires to be employed by the Company 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.  Employment  and  Duties.  The Company  hereby  agrees to employ the
             -----------------------
Executive,  and the Executive hereby accepts employment,  to perform such duties
and  responsibilities  of a senior  vice  president  as are,  from time to time,
assigned  to the  Executive  by the  Board of  Directors,  the  Company's  Chief
Executive  Officer  or the  Company's  President/Chief  Operating  Officer.  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 the
President/Chief  Operating  Officer  of the  Company  or such  other  person  as
designated by the Company's  Board of Directors.  Such duties shall be performed
from the Company's principal executive offices in Kansas City, Missouri.

         2.       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 $250,000
payable in equal bi-weekly installments,  which salary shall be reviewed 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 2(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 executive incentive  compensation program or such other
program or plan for  executive  officers  of the Company as from time to time in
effect and as determined by 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



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employee  benefits to the Executive in respect of the Executive's  employment as
the Company  customarily  provides,  from time to time, to its senior  officers,
including the Company's  Supplemental  Retirement Plan dated January 1, 1988, as
amended  (the  "Supplemental  Retirement  Plan") and other  benefits  for senior
officers  set forth in Exhibit A hereto.  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  5(c)(iii)
below.

                  (d) Non-Qualified Stock Grant. The Executive is hereby granted
a  non-qualified  stock option on 30,000 shares of the Company's  Class A Common
Stock and 5,000 shares of the Company's Restricted Stock, which stock option and
restricted  stock will be governed  under the terms and  provisions of the stock
option agreement  attached hereto as Exhibit "B" (the "Stock Option  Agreement")
and the restricted  stock grant  agreement  attached  hereto as Exhibit "C" (the
"Restricted Stock Grant  Agreement"),  respectively,  except as may otherwise be
provided in this Agreement.

         3.       Confidentiality and Solicitation Provisions.
                  -------------------------------------------

                  (a) Confidentiality of Proprietary Information.  The Executive
agrees  that,  at all times,  both during the  Executive's  employment  with the
Company and after the  termination  thereof,  the Executive shall not divulge to
any other person, firm or corporation, 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 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



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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.

                  (b)   Solicitation   Prohibition.   During   the   Executive's
employment  with  the  Company  and for a  period  of one  (1)  year  after  the
termination 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  with  any  other  person,   firm,   corporation,
partnership,  joint venture or entity whatsoever,  solicit or endeavor to entice
away from the Company any employee who is or was employed by the Company  during
the period that the  Executive  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 termination of the Executive's  employment with
the Company for any reason directly or indirectly,  through any other individual
or entity  solicit,  entice,  persuade  or induce  any  individual  or entity to
terminate,  reduce or refrain from  renewing or  extending  its  contractual  or
prospective relationship or other relationship with the Company.

                  (c) Definition of "Company".  For the purposes of Paragraph 3,
the term  "Company"  shall mean the  Company  and any of its direct or  indirect
subsidiaries.

         4. Covenant Not to Compete.  During the Executive's employment with the
Company  and for a  period  of one year  after  termination  of the  Executive's
employment  with the Company if such  termination  is as a result of a voluntary
termination  by the  Executive  under  Paragraph  5(d) or a  termination  by the
Company for Cause under Paragraph 5(b), the Executive agrees not to engage in or
act as an  officer  or  director,  or on an  individual  basis  as an  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  if the  annual  sales of such  business  (including  any  related  or
commonly owned entity on a combined  basis) from the sale of building  materials
and all related  products and services for the most  recently  completed  fiscal
year  exceeds  $500,000,000.  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  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,  as may be
proper.


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         5.       Termination.
                  -----------

                  (a) Death or Disability. In the event of the Executive's death
or disability as defined in the Company's  disability  plan then in effect,  the
Company's  obligation  to make  further  Base Salary  payments  hereunder  shall
thereupon  terminate.  Executive  shall be  entitled  to receive  any  Incentive
Compensation  which  the  Executive  has  earned,  prorated  to the  date of the
termination of the Executive's employment by reason of death or disability,  and
the Executive's  rights to other  compensation  and benefits shall be determined
under the Company's benefit plans and policies  applicable to Company executives
then in effect.

                  (b)  Termination  for Cause by the Company.  By following  the
procedure  set forth in  Paragraph  5(f),  the  Company  shall have the right to
terminate 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) grossly  neglected or willfully failed in any way to perform  substantially
the duties of the Executive's employment hereunder, including but not limited to
an act of  insubordination;  (iii)  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 or plea of nolo  contendere  to (A) any  felony
(other than any felony arising out of negligence) or any  misdemeanor  involving
moral turpitude,  or (B) any crime or offense involving  dishonesty with respect
to the Company; or (iv) has knowingly and for the Executive's own benefit failed
to comply with the covenants  contained in Paragraphs 3 or 4 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  terminate.  The Executive's
rights  to other  compensation  and  benefits  shall  be  determined  under  the
Company's  benefit plans and policies  applicable to Company  executives then in
effect.

                  (c) Termination for Good Reason by the Executive. By following
the procedure set forth in Paragraph 5(f), the Executive shall have the right to
terminate the  Executive's  employment with the Company for "Good Reason" in the
event (i) the Executive is not at all times a duly elected senior vice president
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 disables the Executive from  performing the  Executive's
duties,  the Company may  reassign 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  2(a) above, a reduction in the percentage of Base Salary which is the
Incentive  Compensation  opportunity of the Executive  under



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Paragraph  2(b),  an  amendment  to the  Supplemental  Retirement  Plan which is
materially  adverse  to the  Executive  or a  material  reduction  in the  other
benefits to which the Executive is entitled under Paragraph 2(c) above; (iv) the
Company  requires the  Executive's  principal place of employment to be anywhere
other than the Company's  principal  executive offices, or there is a relocation
of the Company's principal  executive offices outside of Kansas City,  Missouri;
or (v) the  Company  otherwise  fails to  perform  its  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 5(g) below.

                  (d)  Termination  Without  Cause or Without Good  Reason.  The
Company may terminate 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  5(g) below.  The  Executive  may  voluntarily  terminate the
Executive's  employment  without Good Reason at any time,  and in such event the
Executive's  rights to further Base Salary  payments and Incentive  Compensation
(except  Incentive  Compensation  prorated  to the  date of  termination)  shall
terminate on the effective date of such  resignation and the Executive's  rights
to other  compensation  and benefits  shall be  determined  under the  Company's
benefit plans and policies applicable to Company executives then in effect.

                  (e)  Termination  Upon  Change in  Control.  In the event of a
Change  of  Control  (as  defined  below),   the  Executive  may  terminate  the
Executive's  employment hereunder upon thirty (30) days' prior written notice to
the Company;  provided that (i) such notice of termination  under this Paragraph
5(e) must be given,  if at all,  during the sixty (60) day  period,  immediately
following the first  anniversary of the date of the Change of Control,  and (ii)
until the termination of the Executive's  employment  pursuant to this Paragraph
5(e)  (subject to the continued  right of the Executive to terminate  employment
for Good Reason  pursuant to Paragraph 5(c) above) the Executive  shall continue
to perform the Executive's duties and responsibilities under this Agreement.  In
the event the Executive terminates the Executive's employment hereunder pursuant
to this  Paragraph  5(e),  the  Executive  shall be  entitled  to the  severance
benefits set forth in Paragraph 5(g) below; provided, however, in the event that
any payment or benefit received or to be received by the Executive in connection
with a termination of the Executive's employment pursuant to this Paragraph 5(e)
(collectively,  the  "Termination  Payments")  would (i) constitute a "parachute
payment"  within the meaning of Section  280G of the  Internal  Revenue  Code of
1986, as amended (the "Code"),  or any similar or successor provision to Section
280G (the "Termination  Parachute  Payments") and (ii) but for this proviso,  be
subject to the excise tax imposed by Section  4999 of the Code or any similar or
successor  provisions to Section 4999 (the "Excise Tax"),  then such Termination
Payments  shall be reduced  to the  largest  amount  which the  Company,  in the


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Company's  reasonable  discretion,  determines would result in no portion of the
Termination Parachute Payments being subject to the Excise Tax. The term "Change
in Control" shall occur when and if:

                           (i) any person,  as defined in  Sections  3(a)(9) and
         13(d) of the  Securities  Exchange  Act of 1934 (the  "Exchange  Act"),
         becomes the  "beneficial  owner" (as defined in Rule 13d-3  promulgated
         pursuant to the Exchange Act), directly or indirectly, of securities of
         the Company  having 25% or more of the voting  power in the election of
         directors  of  the  Company,  excluding,  however,  any  person  or  an
         "affiliate"  (as defined in the Exchange Act) of such person who is the
         beneficial  owner of any shares of any class  (preferred  or common) of
         the Company's capital stock on the date hereof; or

                           (ii) the occurrence  within any  twelve-month  period
         while this Agreement is in effect of a change in the Board of Directors
         of the Company with the result that the  Incumbent  Members (as defined
         below)  do  not  constitute  a  majority  of  the  Company's  Board  of
         Directors.  The term "Incumbent  Members" shall mean the members of the
         Board  on the  date  immediately  preceding  the  commencement  of such
         twelve-month  period,  provided  that any  person  becoming  a director
         during  such  twelve-month  period  whose  election or  nomination  for
         election was approved by a majority of the  directors  who, on the date
         of such  election or nomination  for election,  comprised the Incumbent
         Members shall be considered one of the Incumbent  Members in respect of
         such twelve-month period.

                  (f) Notice and Right to Cure. The party proposing to terminate
the  employment of the  Executive for Cause or Good Reason,  as the case may be,
under  Paragraph  5(b) or 5(c)  above  shall give  written  notice to the other,
specifying the reason therefor with particularity.  In the case of a termination
pursuant to  Paragraphs  5(b)(i),  (iii) or (iv), or 5(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 is such that it is not curable,
the party giving such notice may,  within thirty (30) days after the  expiration
of the time so fixed within which to correct such situation, give written notice
to the other party that the employment is terminated effective forthwith.


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                  (g) Severance Benefits. If the Executive's employment with the
Company is terminated by the Company  without  Cause,  by the Executive for Good
Reason  or by the  Executive  after a  Change  of  Control  in  accordance  with
Paragraph 5(e), then the Executive shall be entitled to the following benefits:

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

                           (ii) Incentive Compensation. If the effective date of
         such termination occurs before Incentive Compensation for any preceding
         fiscal year has been paid,  the Company  shall pay to the Executive the
         amount of the  Executive's  Incentive  Compensation  for the  preceding
         fiscal  year  when  and as it would  have  been  paid if the  Executive
         remained employed by the Company.

                           (iii)  Insurance   Coverage.   During  the  Severance
         Period,  the Company shall provide the Executive with health,  life and
         disability  insurance  substantially  similar  to the  coverage  of the
         benefits which the Executive was receiving or entitled to receive under
         Paragraph 2(c) immediately  prior to the date of termination,  the cost
         of which was paid by the  Company.  Such  insurance  coverage  shall be
         provided to the Executive  for the longer of (A) the Severance  Period,
         or (B) the period during which such benefits  would have been provided,
         at the Company's expense, to the Executive under the applicable health,
         life  and  disability   insurance   plans  of  the  Company  in  effect
         immediately prior to the date of termination.

                           (iv) Stock  Incentives.  All of the Executive's stock
         options and restricted stock grants shall continue to vest or be earned
         and be exercisable in accordance with their  respective terms as if the
         Executive  continued to be employed by the Company during the Severance
         Period  (regardless  of  the  death  or  disability  of  the  Executive
         subsequent to the date of termination of employment).

                           (v) Retirement Benefits.  To the extent that benefits
         under  each  of  the   Company's   pension   plans  and  the  Company's
         Supplemental  Retirement  Plan are  computed on the



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         basis of either  the salary and  benefits  paid while in the  Company's
         employ or the term of the Executive's  employment with the Company, the
         benefits  payable and the  Executive's  eligibility  therefor  shall be
         determined as though the Executive  were employed by the Company during
         the Severance Period.

                           (vi)  Outplacement  Benefits.  The  Company,  at  its
         expense,  will provide to the Executive such  outplacement  benefits as
         would be appropriate  for a senior  officer of a company  substantially
         equivalent in size to the Company in terms of sales, profits, number of
         employees,   geographic  location  and  organizational   structure,  as
         determined  by a national  outplacement  service  provider  selected by
         Company.

                  (h)  Survival  of  Certain  Provisions.   Notwithstanding  any
termination of the Executive's employment with the Company under this Agreement,
the  provisions of  Paragraphs 3 and 4 shall,  to the extent  provided  therein,
survive any such  termination  shall be binding upon the Executive in accordance
with the provisions thereof.

         6.  Arbitration.  The parties  hereby  agree that any  dispute  arising
hereunder  or any claim for  breach or  violation  of any item  hereof  shall be
submitted  to  arbitration  pursuant  to the rules of the  American  Arbitration
Association ("AAA") to a panel of three arbitrators selected by mutual agreement
of the parties or, if the parties do not mutually agree on the  arbitration,  in
accordance with the rules of the AAA. The award determination of the arbitrators
shall be final and binding  upon the  parties  without  right of appeal.  Either
party  shall  have  the  right  to bring an  action  in any  court of  competent
jurisdiction  to enforce this  Paragraph and to enforce any  arbitrators'  award
rendered  pursuant  to  this  Paragraph.   The  venue  for  all  proceedings  in
arbitration  hereunder and for any judicial proceedings related thereof shall be
in Kansas City, Missouri.

         7. Business  Expenses.  The Company  shall  reimburse the Executive for
entertainment  and  travel  expenses  related  to  the  Company's   business  in
accordance  with the  practices of the Company in effect on the date hereof with
respect  to the  Executive,  subject  to the right of the  Company to modify its
general policies  relating to expense  reimbursement for employees to the extent
such  modifications do not materially reduce the extent of reimbursement for the
Executive as in effect on the date hereof.

         8. Severability. If any one or more of the provisions of this Agreement
shall be held invalid or unenforceable,  the validity and  enforceability of all
other provisions of this agreement shall not be affected thereby.



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

         10.  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:           Stanley K. Boyd
                                4039 Histead Way
                                Evergreen, CO 80439

    To the Company:             Payless Cashways, Inc.
                                Two Pershing Square
                                2300 Main, P. O. Box  419466
                                Kansas City, MO  64141-0466
                                Attn:    Senior Vice President - Administration/
                                         Secretary

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

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

         13.  Board of  Directors'  Approval.  This  Agreement  will not  become
effective  until approved by the Company's  Board of Directors and then executed
by both of the parties hereto.

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

STANLEY K. BOYD                              PAYLESS CASHWAYS, INC.


/s/ Stanley K. Boyd                          By: /s/ David Stanley
-------------------                          ---------------------------------
                                             David Stanley, Chairman and Chief
                                             Executive Officer


         Approval of the foregoing  Agreement by the  Compensation  Committee of
the Board of Directors of the Company is hereby confirmed.


                                             /s/ John Weitnauer, Jr.
                                             -----------------------------
                                             John Weitnauer, Jr., Chairman