Edgar Filing: LOWES COMPANIES INC

SCHEDULE 14A
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INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

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Lowe's Companies, Inc.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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[LOWE'S LOGO]

April 15, 2002

TO LOWE'S SHAREHOLDERS:

It is my pleasure to invite you to the 2002 Annual Meeting to be held at
The Park Hotel located at 2200 Rexford Road, Charlotte, North Carolina, on
Friday, May 31, 2002 at 10:00 a.m. Directions to The Park Hotel are printed on
the back of the Proxy Statement.

We intend to broadcast the meeting live on the Internet. To participate,
visit Lowe's website (www.lowes.com) and navigate to the registration page by
clicking on "About Lowe's" and then "Investor Information." A link to the
webcast will be posted a few days before the May 31st meeting. An archived
replay will also be available beginning approximately 3 hours after the
conclusion of the meeting and running until June 7, 2002.

The formal Notice of Annual Meeting and Proxy Statement are enclosed with
this letter. There are two items of business, as described in detail in the
Proxy Statement; so your vote or attendance is important. I look forward to
reporting on Fiscal Year 2001, as well as commenting on the results of our first
Fiscal Quarter of 2002.

Yours cordially,

/s/ Robert L. Tillman
Robert L. Tillman
Chairman of the Board
and Chief Executive Officer

LOWE'S COMPANIES, INC.

P.O. BOX 1111
NORTH WILKESBORO, NC 28656

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

MAY 31, 2002

The Annual Meeting of Shareholders of Lowe's Companies, Inc. (the
"Company") will be held at The Park Hotel, 2200 Rexford Road, Charlotte, North
Carolina, on Friday, May 31, 2002 at 10:00 a.m. to consider and act upon the
following proposals:

1. To elect three Class I Directors to a term of three years. The Board of
Directors recommends a vote "FOR" the election of the Director nominees
proposed by the Board.

2. To vote on a shareholder proposal concerning global workplace labor
standards, if presented. The Board of Directors recommends a vote
"AGAINST" this proposal.

3. To transact such other business as may be properly brought before the
Annual Meeting.

Shareholders of record at the close of business on April 1, 2002 are
entitled to notice of and to vote at the meeting. All properly executed proxies
delivered pursuant to this solicitation will be voted at the meeting in
accordance with instructions, if any. If two or more proxies are submitted by
the same shareholder, the proxy bearing the later date will revoke the prior
proxy. Any proxy delivered before the meeting may be revoked by attending the
meeting and voting in person.

You are cordially invited to attend, and we look forward to seeing you at
the meeting.

By order of the Board of Directors,

/s/ Stephen A. Hellrung
Stephen A. Hellrung
Senior Vice President, General
Counsel
& Secretary

Wilkesboro, North Carolina
April 15, 2002

IF YOU DO NOT PLAN TO ATTEND THE MEETING, PLEASE DATE AND SIGN THE PROXY AND
MAIL AT ONCE IN THE ENCLOSED ENVELOPE.

LOWE'S COMPANIES, INC.

P. O. BOX 1111
NORTH WILKESBORO, NORTH CAROLINA 28656
(336) 658-4000
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
MAY 31, 2002

This Proxy Statement is being furnished in connection with the solicitation
by the Board of Directors of Lowe's Companies, Inc. (the "Company") of proxies
to be voted at the Annual Meeting of Shareholders to be held at The Park Hotel,
2200 Rexford Road, Charlotte, North Carolina, on Friday, May 31, 2002 at 10:00
a.m. It is anticipated that this Proxy Statement and the enclosed form of proxy
will first be sent to shareholders on or about April 15, 2002.

Only shareholders of record at the close of business on April 1, 2002 are
entitled to notice of and to vote at the meeting or any adjournment thereof. On
April 1, 2002 there were 776,775,934 shares of Common Stock of the Company
outstanding and entitled to vote. Shareholders are entitled to one vote for each
share held on all matters to come before the meeting.

The shares represented by a proxy will be voted as directed unless the
proxy is revoked. Any proxy may be revoked before it is exercised by filing with
the Secretary of the Company an instrument revoking the proxy or a proxy bearing
a later date. A proxy is revoked if the person who executed the proxy is present
at the meeting and elects to vote in person.

Abstentions and shares held of record by a broker or its nominee ("broker
shares") that are voted on any matter are included in determining the number of
votes present or represented at the meeting. Broker shares that are not voted on
any matter at the meeting are not included in determining whether a quorum is
present. The vote required on matters to be considered is disclosed under the
caption for such matters. Votes that are withheld and broker shares that are not
voted (commonly referred to as "broker non-votes") are not included in
determining the number of votes cast in the election of Directors or on other
matters.

PROPOSAL 1

ELECTION OF DIRECTORS

There are currently 11 members of the Board of Directors, which is divided
into three classes: Class I (three members), Class II (four members) and Class
III (four members), with one class being elected each year for a three-year
term.

The three nominees standing for re-election as Class I Directors are:
Robert A. Ingram, Richard K. Lochridge and Claudine B. Malone.

If elected, each Class I nominee will serve three consecutive years with
his/her term expiring in 2005 or until a successor is elected and qualified. The
election of each nominee requires the affirmative vote of the holders of the
plurality of the shares of Common Stock cast in the election of Directors.
Unless authority to vote in the election of Directors is withheld, it is the
intention of the persons named as Proxies to vote "FOR" the three nominees. If
at the time of the meeting any of these nominees is unavailable for election as
a Director for any reason, which is not expected to occur, the persons named as
Proxies will vote for such substitute nominee or nominees, if any, as shall be
designated by the Board of Directors.

INFORMATION CONCERNING THE NOMINEES

The nominees for election for a three-year term as a Class I Director to
serve until the 2005 Annual Meeting are Robert A. Ingram, Richard K. Lochridge
and Claudine B. Malone.

CLASS I NOMINEES
(Term Expiring in 2005)

DIRECTOR BUSINESS EXPERIENCE, DIRECTORSHIPS, AND
NAME AND AGE SINCE POSITIONS WITHIN THE LAST FIVE YEARS
---------------------------------- -------- ------------------------------------------------------

Robert A. Ingram, 60.............. 2001 Member of Compensation and Organization Committee and
Governance Committee. Chief Operating Officer and
(INGRAM PHOTO) President, Pharmaceutical Operations, of
GlaxoSmithKline (International Pharmaceutical
Corporation) since January 2001, having previously
served as Chief Executive of Glaxo Wellcome plc
(1997-2000), Chairman of Glaxo Wellcome Inc., (Glaxo
Wellcome plc's United States subsidiary) (1999-2000);
Chairman, President and Chief Executive Officer of
Glaxo Wellcome Inc. (1997-1999), and President and
Chief Executive Officer of Glaxo Wellcome Inc. prior
thereto. Other directorships: Nortel Networks
Corporation, Wachovia Corporation and Misys plc.

Richard K. Lochridge, 58.......... 1998 Chairman of Audit Committee and member of Executive
Committee and Governance Committee of the Company.
(LOCHRIDGE PHOTO) President, Lochridge & Company, Inc., (General
Management Consulting Firm) since 1986. Other
directorships: PetsMart, Inc., John H. Harland
Company, and Dover Corporation.

Claudine B. Malone, 65............ 1995 Member of Compensation and Organization Committee and
Governance Committee of the Company. President and
(MALONE PHOTO) Chief Executive Officer, Financial & Management
Consulting, Inc., since 1984; Former Chairman, Federal
Reserve Bank, Richmond, Va., 1996-1999 (Member since
1994). Other directorships: LaFarge Corporation,
Science Applications International Corporation,
Hasbro, Inc., and CGNU Life Insurance Co.

INFORMATION CONCERNING CONTINUING DIRECTORS

Directors whose terms expire after 2002 are:

CLASS II DIRECTORS
(Term Expiring in 2003)

Peter C. Browning, 60............. 1998 Chairman of Governance Committee and member of
Compensation and Organization Committee, and Executive
(BROWNING PHOTO) Committee of the Company. Non-executive Chairman of
the Board of Nucor Corporation (Steel Manufacturer)
since 2000. Dean of the McColl School of Business at
Queens College of Charlotte. Other directorships:
Acuity Brands Inc., Wachovia Corporation, The Phoenix
Companies, Inc., EnPro Industries, Inc., and Sykes
Enterprises, Inc.

Kenneth D. Lewis, 55.............. 2000 Member of Compensation Committee and Governance
Committee of the Company. Chairman, Chief Executive
(LEWIS PHOTO) Officer and President of Bank of America Corp.,
President and Chief Operating Officer (Oct. 1999-April
2001), President (Jan. 1999-Oct. 1999), President,
Consumer and Commercial Banking (1998-1999) of that
Company, and President of NationsBank Corporation
(1993-1998). Director of Bank of America Corp. since
1999. Other directorships: Health Management
Associates, Inc.

Thomas D. O'Malley, 60............ 2000 Member of Audit Committee and Governance Committee of
the Company. Chairman of the Board and Chief Executive
(O'MALLEY PHOTO) Officer of Tosco Corporation until its sale to
Phillips Petroleum in 2001. Currently serving as
Chairman, President and Chief Executive Officer of
Premcor, an oil refiner.

Robert G. Schwartz, 74............ 1973 Member of Compensation and Organization Committee and
Governance Committee of the Company. Former Director
(SCHWARTZ PHOTO) (1980-2000) and Chairman of the Board (1983-1993) and
Former President and Chief Executive Officer
(1989-1993) of Metropolitan Life Insurance Company.
(Mr. Schwartz retired from employment in March 1993
and as a Director in April 2000.)

CLASS III DIRECTORS
(Term Expiring in 2004)

Leonard L. Berry, 59.............. 1998 Member of Audit Committee and Governance Committee of
the Company. Distinguished Professor of Marketing and
(BERRY PHOTO) M.B. Zale Chair in Retailing and Marketing Leadership,
Texas A&M University, since 1982. Other directorships:
Genesco Inc., Darden Restaurants, Inc., and Grocery
Outlet, Inc.

Paul Fulton, 67................... 1996 Chairman of Compensation and Organization Committee
and member of Executive Committee and Governance
(FULTON PHOTO) Committee of the Company. Chairman since 2000 and
Director since 1997 of Bassett Furniture Industries,
Inc., Chief Executive Officer of Bassett Furniture
from 1997 until 2000. Dean, Kenan-Flagler Business
School, University of North Carolina, Chapel Hill,
N.C., 1994-1997. Other directorships: Sonoco Products
Company, and Bank of America Corp.

Dawn Hudson, 44................... 2001 Member of Audit Committee and Governance Committee of
the Company. Senior Vice President, Strategy and
(HUDSON PHOTO) Marketing for Pepsi Cola North America (International
Beverage Company) since 1996.

Robert L. Tillman, 58............. 1994 Chairman of the Board since January 1998, Chief
Executive Officer since 1996. Chairman of Executive
(TILLMAN PHOTO) Committee of the Company.

INFORMATION ABOUT THE BOARD OF DIRECTORS AND
COMMITTEES OF THE BOARD

CLASSIFICATION OF DIRECTORS. Each Lowe's Director is classified as an
"Independent Director" or a "Management Director". A "Management Director" is a
present or former employee who serves as a Director. An "Independent Director"
is a Director within the scope of Securities and Exchange Commission rules
defining "non-employee directors." All Directors are Independent Directors
except for Mr. Tillman, who is a Management Director.

COMPENSATION OF DIRECTORS -- STANDARD ARRANGEMENTS. Mr. Tillman receives
no Director or Committee compensation. Directors who are not employed by the
Company are paid an annual retainer of $75,000, plus $15,000 annually for
serving as a Committee Chairman.

COMPENSATION OF DIRECTORS -- OTHER ARRANGEMENTS. In 1999, shareholders
approved the Lowe's Companies, Inc. Directors' Stock Option Plan. This Plan
provides for each eligible Director to be awarded a stock option to purchase
4,000 shares of Company Common Stock at the first Directors' Meeting following
the Annual Meeting (the "Award Date"). The Company reserved 500,000 shares of
Common Stock for the Plan, with 100,000 shares being reserved for options
granted in Fiscal Years 1999, 2000 and 2001, of which 26,674 option shares are
exercisable. Each option becomes exercisable with respect to 1,334 of the shares
of Common Stock on May 15 of the first calendar year following the Award Date
and 1,333 shares on May 15 of each of the second and third calendar years
following the Award Date. Each option has a seven-year term. The exercise price
is set based on the closing price of a share of Common Stock as reported on the
New York Stock Exchange composite tape on the Award Date, which was $35.91 as of
May 25, 2001. Options for 4,000 shares each were granted on May 25, 2001 to
Directors Berry, Browning, Fulton, Hudson, Ingram, Lewis, Lochridge, Malone,
O'Malley, and Schwartz.

In 1994, the Board adopted the Lowe's Companies, Inc. Directors' Deferred
Compensation Plan. This Plan allows each non-employee Director to defer receipt
of all, but not less than all, of the annual retainer and meeting fees otherwise
payable to the Director. Deferrals are credited to a bookkeeping account and
account values are adjusted based on the investment measure selected by the
Director. One investment measure adjusts the account based on the Wachovia Bank
and Trust Company prime rate plus 1%. The other investment measure assumes that
the deferrals are invested in the Company's Common Stock. A Director may
allocate deferrals between the two investment measures in 25% increments.
Account balances are paid in cash following the termination of a Director's
service.

BOARD OF DIRECTORS -- During Fiscal Year 2001, the Board of Directors held
six meetings. The Board has four standing committees, which met the number of
times set forth in parentheses: Executive (3), Audit (4), Compensation and
Organization (7) and Governance (3). All Directors attended at least 75% of the
meetings of the Board and the Committees on which they served, except Robert A.
Ingram and Kenneth D. Lewis, who each attended 71% of the meetings of the Board
and the Committees on which they served.

AUDIT COMMITTEE -- The Audit Committee has four members: Richard K.
Lochridge (Chairman), Leonard L. Berry, Dawn Hudson and Thomas D. O'Malley. The
Audit Committee meets with the internal auditing staff and representatives of
the Company's independent accounting firm without senior management present and
with representatives of senior management. The Committee reviews the general
scope of the Company's annual audit and the fees charged by the independent
accountants for audit services, financial information systems design and
implementation services, and all other services; determines the duties and
responsibilities of the internal auditors; reviews financial statements and the
accounting principles being applied; and reviews audit results and other matters
relating to internal control and compliance with the
6

Company's code of ethics. In addition, the Audit Committee recommends annually
the engagement of the Company's independent accountants. The Board of Directors
adopted an amended and restated Audit Committee Charter on April 5, 2002, which
is attached to this proxy statement as Appendix A.

COMPENSATION AND ORGANIZATION COMMITTEE -- The Compensation and
Organization Committee has six members: Paul Fulton (Chairman), Peter C.
Browning, Robert A. Ingram, Kenneth D. Lewis, Claudine B. Malone, and Robert G.
Schwartz. This Committee reviews and sets the compensation of Directors who are
employees of the Company; reviews the compensation of Senior management; reviews
and approves all annual bonus plans; reviews and approves all forms of
compensation which exceed one year in duration, including employee stock option
and deferred compensation awards; administers and interprets all provisions of
all compensation, employee stock option, stock appreciation rights and other
incentive plans; and approves awards pursuant to the terms of any employee stock
option or stock appreciation rights plan.

EXECUTIVE COMMITTEE -- The Executive Committee has four members: Robert L.
Tillman (Chairman), Peter C. Browning, Paul Fulton, and Richard K. Lochridge.
The Executive Committee exercises all of the powers of the Board of Directors
between meetings, except as otherwise limited by law.

GOVERNANCE COMMITTEE -- The Governance Committee has ten members: Peter C.
Browning (Chairman), Leonard L. Berry, Paul Fulton, Dawn Hudson, Robert A.
Ingram, Kenneth D. Lewis, Richard K. Lochridge, Claudine B. Malone, Thomas D.
O'Malley and Robert G. Schwartz. This Committee's responsibilities include
screening suggestions for new Board members and making recommendations to the
full Board; conducting an annual performance evaluation of the Chief Executive
Officer; and conducting an annual review of the performance of the full Board
and structure of Board Committees. This Committee functions as a nominating
committee by recommending nominees for election as Directors of the Company. The
Committee considers nominees recommended by shareholders. Any such
recommendation should be submitted in writing to the Secretary of the Company no
later than 120 days prior to the date of mailing the proxy materials for each
annual meeting (generally, not later than the middle of December preceding the
Annual Meeting). The recommendation should include information that will enable
the Committee to evaluate the qualifications of the proposed nominee.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table shows the beneficial ownership as of April 1, 2002,
except as noted, of Common Stock of each Director of the Company, each nominee
for election as a Director of the Company, the Officers named in the Summary
Compensation Table, each shareholder known to the Company to be the beneficial
owner of more than 5% of the Company's Common Stock, and Directors and Executive
Officers as a group:

NAME OR NUMBER NUMBER OF PERCENT
OF PERSONS IN GROUP SHARES (1) (2) OF CLASS
------------------- -------------- --------

Leonard L. Berry............................................ 11,501 *
Peter C. Browning........................................... 11,644 *
Paul Fulton................................................. 29,501 *
Dawn Hudson................................................. 400 *
Robert A. Ingram............................................ 0 *
Kenneth D. Lewis............................................ 1,334 *
Richard K. Lochridge........................................ 12,001 *
Claudine B. Malone.......................................... 14,001 *
Thomas D. O'Malley.......................................... 21,334 *
Dale C. Pond................................................ 242,222 *
Robert G. Schwartz.......................................... 142,001 *
Larry D. Stone.............................................. 429,830 *
Robert L. Tillman........................................... 1,197,538 *
William C. Warden, Jr....................................... 174,372 *
Thomas E. Whiddon........................................... 292,128 *
Incumbent Directors, Director Nominees and Executive
Officers as a Group (31).................................. 5,729,567 *
Lowe's Companies Employee Stock Ownership Trust
P.O. Box 1111
North Wilkesboro, NC 28656................................ 48,514,969(3) 6.24
State Street Bank and Trust Company, Trustee
225 Franklin Street
Boston, MA 02110.......................................... 70,961,985(4) 9.2
Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071..................................... 80,002,200(5) 10.3
FMR Corp.
82 Devonshire Street E14B
Boston, MA 02109.......................................... 47,547,529(6) 6.148

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

* Less than 1%.

(1) Includes shares that may be acquired within 60 days under the Company's
Stock Option Plans as follows: Mr. Pond 135,098 shares; Mr. Stone 239,980
shares; Mr. Tillman 721,334 shares; Mr. Warden 119,112 shares; Mr. Whiddon
234,134 shares; Directors Berry, Browning, Fulton, Lochridge, Malone and

Schwartz 4,000 shares each; Directors Lewis and O'Malley 1,334 shares each
with aggregate shares for all Executive Officers and Directors as a group
(31) being 2,727,308.

(2) Does not include phantom shares credited to the accounts of Executive
Officers and Directors under the Company's Deferred Compensation Plans as
follows: Mr. Bridgeford 58,361 shares; Mr. Browning 4,412 shares; Mr. Fulton
4,479 shares; Mr. Herring 14,105 shares; Mr. Ingram 1,725 shares; Mr.
Kasberger 5,002 shares; Mr. Lewis 1,725 shares; Mr. Shelton 40,109 shares;
Mr. Tillman 199,775 shares; Mr. Warden 50,136 shares; Mr. Whiddon 120,531
shares with aggregate shares for all Executive Officers and Directors as a
group (31) being 499,787.

(3) Shares allocated to participants' ESOP accounts are voted by the
participants by giving voting instructions to State Street Bank (the
"Trustee"). A committee directs the Trustee in the manner in which shares
not voted by participants or not allocated to participants' ESOP accounts
are to be voted. The committee has seven members, including Mr. Stone. At
April 1, 2002, there were 842,061 unallocated shares in participant's ESOP
accounts.

(4) Shares held at December 31, 2001, according to Schedule 13G filed on
February 6, 2002 with the Securities and Exchange Commission, which total
includes those shares held by the Lowe's Companies Employee Stock Ownership
Trust and described in footnote 3.

(5) Shares held at December 31, 2001, according to Schedule 13G filed on
February 11, 2002 with the Securities and Exchange Commission.

(6) Shares held at December 31, 2001, according to Schedule 13G filed on
February 14, 2002 with the Securities and Exchange Commission.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company pursuant to Rule 16a-3(e) of the Securities Exchange
Act of 1934 during Fiscal Year 2001 and Form 5 and amendments thereto furnished
to the Company with respect to Fiscal Year 2001, and written representations
from certain reporting persons, the Company believes that all filing
requirements under Section 16(a) applicable to its Officers, Directors and
beneficial owners have been complied with, except that three of the Company's
Executive Officers, inadvertently in all cases, failed to disclose in a timely
manner beneficial ownership or sales of the Company's stock. Michael K. Brown,
Senior Vice President -- Store Operations, did not disclose in his Initial
Statement of Beneficial Ownership of Securities (Form 3) dated November 29, 2001
beneficial ownership of 10,000 shares of restricted stock. Mr. Brown listed the
shares in a subsequent filing on February 26, 2002. Dale C. Pond, Executive Vice
President, Merchandising sold 5,000 shares (pre-split) of the Company's Common
Stock on March 5, 2001. Mr. Pond reported this sale on January 30, 2002. Larry
D. Stone, Executive Vice President, Store Operations, sold 15,200 shares of the
Company's Common Stock on December 20, 2001. Mr. Stone reported the sale on
February 28, 2002.

COMPENSATION OF EXECUTIVE OFFICERS

The following table discloses compensation received by the Company's Chief
Executive Officer and the four other most highly paid Executive Officers for the
three fiscal years ended February 1, 2002:

SUMMARY COMPENSATION TABLE

LONG-TERM COMPENSATION
-------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
-------------------------------- ------------------------------- -------
FISCAL YEAR OTHER ANNUAL RESTRICTED STOCK STOCK OPTIONS LTIP ALL OTHER
NAME & PRINCIPAL POSITION ENDED SALARY BONUS COMPENSATION AWARDS (1) # SHARES (2) PAYOUTS COMPENSATION (3)
------------------------- ----------- ------- --------- ------------ ---------------- ------------- ------- ----------------

Robert L. Tillman.......... 02/01/02 935,000 1,916,049 471,384(4) 0 shares 499,000 0 17,000
Chairman of the Board 02/02/01 935,000 690,030 184,010 0 shares 324,000 0 11,900
and Chief Executive Officer 01/28/00 850,000 1,700,000 406,711 0 shares 0 0 19,200

Larry D. Stone............. 02/01/02 600,000 982,950 232,144(5) 0 shares 223,000 0 17,000
Executive Vice President, 02/02/01 600,000 442,800 102,004 0 shares 154,000 0 11,900
Store Operations 01/28/00 500,000 1,000,000 221,984 0 shares 0 0 19,200

William C. Warden, Jr...... 02/01/02 470,000 769,978 176,361(6) 0 shares 193,000 0 17,000
Executive Vice President, 02/02/01 460,000 339,480 73,995 0 shares 118,000 0 11,900
Administration 01/28/00 400,000 800,000 173,890 0 shares 0 0 19,200

Thomas E. Whiddon.......... 02/01/02 470,000 769,978 176,360(7) 0 shares 193,000 0 17,000
Executive Vice President, 02/02/01 450,000 332,100 75,070 0 shares 116,000 0 11,900
Logistics and Technology 01/28/00 390,000 780,000 167,904 0 shares 0 0 19,200

Dale C. Pond............... 02/01/02 450,000 737,213 169,208(8) 0 shares 177,000 0 17,000
Executive Vice President, 02/02/01 400,000 295,200 62,430 0 shares 104,000 0 11,900
Merchandising 01/28/00 350,000 700,000 148,637 0 shares 0 0 19,200

Footnotes:
---------------

(1) No Restricted Stock Awards were granted during Fiscal 1999, 2000, or 2001.

(2) Share amounts reflect a 2 for 1 stock split effective June 29, 2001.

(3) Amounts shown are employer contributions to the Employee Stock Ownership
Plan.

(4) Amount shown is the total of a payment under the Company's Benefit
Restoration Plan ($441,449), taxable value of group term life insurance in
excess of $50,000 ($1,633), and taxable value of personal use of corporate
aircraft ($28,302).

(5) Amount shown is the total of a payment under the Company's Benefit
Restoration Plan ($231,591) and taxable value of group term life insurance
in excess of $50,000 ($553).

(6) Amount shown is the total of a payment under the Company's Benefit
Restoration Plan ($176,251) and taxable value of group term life insurance
in excess of $50,000 ($110).

(7) Amount shown is the total of a payment under the Company's Benefit
Restoration Plan ($176,251) and taxable value of group term life insurance
in excess of $50,000 ($109).

(8) Amount shown is the total of a payment under the Company's Benefit
Restoration Plan ($167,737) and taxable value of group term life insurance
in excess of $50,000 ($1,471).

OPTION/SAR GRANTS IN LAST FISCAL YEAR

The following table provides information with respect to stock options and
SARs granted to the named Executive Officers during Fiscal 2001:

INDIVIDUAL GRANTS
---------------------------------------------------------------------------------- POTENTIAL REALIZABLE VALUE AT
NUMBER OF % OF TOTAL ASSUMED ANNUAL RATES OF
SECURITIES OPTIONS/SARS STOCK PRICE APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OR OPTION TERM
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION -----------------------------
NAME GRANTED (1) FISCAL YEAR $/SH DATE 5% 10%
---- ------------ ------------ ----------- ---------- ------------- -------------

Robert L. Tillman......... 324,000 2.97% $27.51 3/1/08 $3,627,924 $8,454,606
175,000 1.60% $45.70 2/1/09 $3,255,786 $7,587,365

Larry D. Stone............ 138,000 1.27% $27.51 3/1/08 $1,545,227 $3,601,036
85,000 0.78% $45.70 2/1/09 $1,581,382 $3,685,292

William C. Warden, Jr..... 108,000 0.99% $27.51 3/1/08 $1,209,308 $2,818,202
85,000 0.78% $45.70 2/1/09 $1,581,382 $3,685,292

Thomas E. Whiddon......... 108,000 0.99% $27.51 3/1/08 $1,209,308 $2,818,202
85,000 0.78% $45.70 2/1/09 $1,581,382 $3,685,292

Dale C. Pond.............. 92,000 0.84% $27.51 3/1/08 $1,030,151 $2,400,691
85,000 0.78% $45.70 2/1/09 $1,581,382 $3,685,292

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

(1) Share amounts reflect a 2 for 1 stock split effective June 29, 2001.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES

The following table provides information concerning options exercised
during Fiscal Year 2001 and the unexercised options/SARs held by each of the
named Executive Officers at February 1, 2002:

VALUE OF UNEXERCISED
NUMBER OF SECURITIES IN-THE-MONEY
UNDERLYING UNEXERCISED OPTIONS/SARS AT FY-END
SHARES OPTIONS/SARS AT FY-END ($45.70 ON 2/1/02)
ACQUIRED ON VALUE ------------------------------- ---------------------------
NAME EXERCISE (1) REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------------- ----------- -------------- -------------- ----------- -------------

Robert L. Tillman.......... 760,000 Shares $17,347,924 613,334 Shares 605,666 Shares $14,002,681 $8,256,498
Larry D. Stone............. 344,444 7,480,220 198,224 274,332 4,489,712 3,647,272
William C. Warden, Jr...... 321,156 7,113,436 83,112 232,332 1,844,613 2,835,772
Thomas E. Whiddon.......... 212,300 5,534,082 198,134 231,666 4,604,185 2,821,028
Dale C. Pond............... 171,304 2,906,107 104,430 211,666 2,349,108 2,441,358

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

(1) All shares acquired on exercise are stock options. There are no currently
outstanding stock appreciation rights (SAR) grants.

LONG-TERM INCENTIVE PLANS -- AWARDS IN LAST FISCAL YEAR

No awards were made under any long-term incentive plans for the Company
during Fiscal Year 2001.

EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT
AND CHANGE IN CONTROL ARRANGEMENTS

The Company has entered into Management Continuity Agreements with each of
Messrs. Tillman, Stone, Warden, Whiddon and Pond, as well as 15 other executive
officers. Other than the termination compensation amounts, the agreements are
identical. Each was unanimously approved by the Independent Directors of the
Board of Directors.

The agreements provide for certain benefits if the Company has a
change-in-control followed by termination of the executive's employment without
cause by the Company's successor, or by the employee for certain reasons,
including a downgrading of the officer's position. "Cause" means continued and
willful failure to perform duties or conduct demonstrably and materially
injurious to the Company.

All agreements provide for three-year terms. On the first anniversary, and
every anniversary thereafter, the term is extended automatically for an
additional year unless the Company does not extend the term. The agreements are
automatically extended for 24 months after a change-in-control.

If benefits are paid under an agreement, the executive will receive (i) a
lump-sum severance payment equal to three times annual base salary, incentive
bonus and welfare insurance costs for Mr. Tillman and all executive vice
presidents, including Messrs. Stone, Warden, Whiddon and Pond, and two times
annual base salary, incentive bonus and welfare insurance costs for all other
executive officers, and (ii) any other unpaid salary and benefits to which the
executive is otherwise entitled. In addition, the executive will be compensated
for any excise tax liability he may incur as a result of this payment and for
income taxes attributable to excise tax reimbursements.

All legal fees and expenses incurred by the executives in enforcing these
agreements will be paid by the Company.

REPORT OF THE COMPENSATION AND ORGANIZATION COMMITTEE

This report by the Compensation and Organization Committee is required by
rules of the Securities and Exchange Commission. It is not to be deemed
incorporated by reference by any general statement which incorporates by
reference this Proxy Statement into any filing under the Securities Act of 1933
or the Securities Exchange Act of 1934, and it is not to be otherwise deemed
filed under either such Act.

The Compensation and Organization Committee (the "Committee") of the Board
of Directors comprises six Independent Directors and is responsible for
administering the Company's Executive Compensation Program for all executives at
a compensation level set by the Committee. In carrying out its responsibilities,
the Committee:

- Articulates the Company's executive compensation philosophies and
policies to executive management, participates in compensation program
development, and has authority for approval of awards under the Company's
plans and programs;

- Monitors and approves on-going base salary and incentive compensation
programs for executive management, including participation, performance
goals and criteria, interpretation of provisions and determination of
award payouts;

- Reviews and approves base salary recommendations for Executive Officers
of the Company; and

- Initiates all compensation actions for the Chairman of the Board,
President and Chief Executive Officer, subject to final Board approval.

The Committee has retained a national consulting firm (which reports to the
Committee) to be a source of on-going advice to both the Committee and
management.

EXECUTIVE COMPENSATION PRINCIPLES

The Company's Executive Compensation Program has been designed to establish
a strong link between the creation of shareholder value and the compensation
earned by its Executive Officers. It is the intention of the Committee that, to
the extent practical, all compensation paid under the Executive Compensation
Program of the Company (other than incentive stock options) will be tax
deductible to the Company in the year paid to the executive. The fundamental
objectives of the Program are to:

- Align executive compensation with the Company's mission, values and
business strategies;

- Attract, motivate, retain and reward the executives whose leadership and
performance are critical to the Company's success in enhancing
shareholder value; and

- Provide compensation which is commensurate with the Company's performance
and the contributions made by executives toward this performance.

The Program is intended to provide compensation which is competitive with
comparable companies in the retailing industry (with particular emphasis on
specialty hardgoods retailers and major U.S. retailers) when the Company is
meeting its targeted financial goals. At the same time, the Program seeks to
provide above average compensation when the Company's targeted goals are
exceeded, and below average compensation when targeted performance goals are not
achieved.

The Program provides for larger portions of total compensation to vary on
the basis of Company performance for higher levels of executives (i.e., the most
senior executive Officers have more of their total compensation at risk on the
basis of Company performance than do lower levels of executives). All Executive
Officers participate in the same direct compensation programs as the other
executives of the Company, with the only differences being the degree of
compensation risk and the overall magnitude of the potential awards.

The Committee believes that Executive Officers of the Company should be
encouraged to own significant holdings of the Company's Common Stock to align
their interests with those of the Company's shareholders. Through the operation
of the Company's Employee Stock Ownership Plan, the 401(k) Plan, the Employee
Stock Purchase Plan, the 1994 Incentive Plan, the 1997 Incentive Plan, and the
2001 Incentive Plan, vehicles are provided to enable executives to acquire
Common Stock, subject to regulatory limitations.

ELEMENTS IN THE EXECUTIVE COMPENSATION PROGRAM

The Company's Executive Compensation Program comprises the following
elements:

Base Salary

Salaries for Executive Officers are established on the basis of the
qualifications and experience of the executive, the nature of the job
responsibilities and salaries for competitive positions in the retailing
industry.

Executive Officers' base salaries are reviewed annually and are approved by
the Committee. Salaries of Executive Officers are compared with those of
comparable executive positions in the retailing industry

throughout the United States. The Committee uses the median level of base salary
as a guideline, in conjunction with the executive's performance and
qualifications, for establishing salary levels.

1994, 1997 and 2001 Incentive Plans

The 1994, 1997 and 2001 Incentive Plans, which were approved by
shareholders in 1994, 1997 and 2001, respectively, are intended to attract,
motivate, retain and reward the executives whose leadership and performance are
critical to the Company's success in enhancing shareholder value. The Incentive
Plans help to place further emphasis on executive ownership of the Company's
Common Stock. The Incentive Plans are designed to assure the deductibility of
executive compensation for federal and state income tax purposes.

Short-Term Incentives. The Management Bonus Program is administered
pursuant to the Incentive Plans. The Management Bonus Program provides bonus
opportunities that can be earned upon the achievement by the Company of
predetermined annual earnings growth objectives. No bonuses are paid if
performance is below the threshold level of corporate profitability. If the
financial goals are fully met, 100% of the stated bonus opportunity is earned. A
bonus equal to 204.9% of the February 3, 2001 base salary was paid to the Chief
Executive Officer and bonuses equal to 163.8% of the February 3, 2001 base
salary were paid to the four other most highly paid Executive Officers for the
year ended February 1, 2002 because the Company's financial results exceeded the
predetermined annual earnings growth objectives.

Long-Term Incentives. The Incentive Plans authorize the grant of stock
options. The option price cannot be less than the market price of the Company's
Common Stock on the date on which the option is granted. Consequently, stock
options granted under the Incentive Plans measure performance and provide
compensation solely on the basis of the appreciation in the price of the
Company's Common Stock. During Fiscal Year 2001, the Committee approved a
broad-based stock option grant to executive and senior management, middle
managers and professionals, and retail store managers and assistant managers.

Under the 2001 Incentive Plan, the Committee approved the grant of
non-qualified stock options for a total of 3,750,000 shares to senior executives
on February 1, 2002. Each of the option grants had an execution price of $45.70
per share and will be fully vested on the third anniversary of the grant. Mr.
Tillman was granted 175,000 shares, five Executive Vice Presidents were granted
85,000 shares each, fourteen Senior Vice Presidents were granted 60,000 shares
each and sixty-six Vice Presidents and Regional Vice Presidents were granted
35,000 shares each.

Stock appreciation rights also may be granted under the Incentive Plans.
These rights entitle the recipient to receive a payment based solely on the
appreciation in the Company's Common Stock following the date of the award.
Stock appreciation rights thus measure performance and provide compensation only
if the price of the Company's Common Stock appreciates. No stock appreciation
rights grants were made during Fiscal Year 2001 nor are any previous grants
outstanding.

The Incentive Plans also authorize awards of Company Common Stock. No
Performance Accelerated Restricted Stock (PARS) or Performance Stock Awards were
issued during Fiscal Year 2001, nor are any previous grants outstanding.

The 1994, 1997, and 2001 Incentive Plans include a Deferral Program. The
Deferral Program, available to executives at or above the Vice-President level,
permits deferral of receipt of certain stock incentives (vested performance
stock awards and performance accelerated restricted stock and gain on
non-qualified stock options), but not salary or bonus. The single exception to
this provision is that the Deferral Program will

accept the mandatory deferral of cash compensation to the extent that it would
not be a tax-deductible item for the Company under the Internal Revenue Code
Section 162(m).

The Deferral Program requires that the executive make a deferral election
in the year prior to the year in which a stock option is exercised or the year a
restricted stock grant vests. Deferred shares are cancelled upon the
participant's election and tracked as phantom shares. During the deferral
period, the participant's account is credited with amounts equal to the
dividends paid on actual shares. Shares are reissued when distributed to the
executive. Unless a participant elects otherwise, deferred benefits are
generally payable beginning on the March 15 following the earlier of the
executive's retirement or other termination of employment or his or her 65th
birthday.

The Deferral Program is unfunded. A deferred benefit under the Program is
at all times a mere contractual obligation of the Company. A participant and his
beneficiaries have no right, title, or interest in the benefits deferred under
the Program or any claim against them.

Benefit Restoration Plan

The Benefit Restoration Plan, adopted by the Company in May 1990 and
amended and restated as of February 1, 1997, is intended to provide qualifying
executives with benefits equivalent to those received by all other employees
under the Company's basic qualified employee retirement plans. Qualifying
executives are those executives who are selected by the Committee to participate
in the Plan and whose annual additions and other benefits, as normally provided
to all participants under those qualified plans, would be curtailed by the
effect of Internal Revenue Code restrictions. The Benefit Restoration Plan
benefits are determined annually. Participating executives may elect annually to
defer benefits or to receive a current cash payment.

Other Compensation

The Company's Executive Officers participate in the various qualified and
non-qualified employee benefit plans sponsored by the Company. The Company makes
only nominal use of perquisites in compensating its Executive Officers.

The CEO's Compensation in the Fiscal Year Ended February 1, 2002

The Committee increased Mr. Tillman's annual base salary from $935,000 to
$1,000,000 effective February 2, 2002, the start of the next fiscal year. The
Committee made its decision based upon the operating performance of the Company.

The Committee authorized payment to Mr. Tillman of an annual bonus of
$1,916,049 under the 2001 Management Bonus Program. The Committee determined Mr.
Tillman's bonus solely on the basis of the Company's earnings performance versus
the goals for such performance which the Committee established at the beginning
of the performance period.

Mr. Tillman was granted options for 162,000 shares (pre-split) of Company
Stock on March 1, 2001 at $55.01, the fair market value of the Stock on the date
of the grant; 1,817 shares of the grant are incentive stock options and the
remaining 160,183 shares are non-qualified stock options. The options become
exercisable in thirds after one, two and three years from the date of the grant.
The options expire after seven years.

Mr. Tillman was also granted options for 175,000 shares of Company Stock on
February 1, 2002 at $45.70, the fair market value of the Stock on the date of
the grant; all of the shares are non-qualified stock

options. The options become exercisable three years from the date of the grant.
The options expire after seven years.

Mr. Tillman earned a Benefit Restoration Plan payment of $441,254 for the
fiscal year ended February 1, 2002. This amount was deferred. Mr. Tillman was
paid a Benefit Restoration Plan benefit of $46,000 which had been mandatorily
deferred in prior years due to IRC Section 162(m) limitations.

The Committee believes that the payments and stock incentives described
herein were necessary to maintain the competitiveness of Mr. Tillman's
compensation package in comparison to those of other chief executive officers of
similarly situated companies.

* * *

The Committee believes that the Company's Executive Compensation Program
has been strongly linked to the Company's performance and the enhancement of
shareholder value. The Committee intends to continually evaluate the Company's
compensation philosophies and plans to ensure that they are appropriately
configured to align the interests of executives and shareholders and to ensure
that the Company can attract, motivate and retain talented management personnel.

Paul Fulton, Chairman
Peter C. Browning
Robert A. Ingram
Kenneth D. Lewis
Claudine B. Malone
Robert G. Schwartz

April 4, 2002

AUDIT MATTERS

REPORT OF THE AUDIT COMMITTEE

This report by the Audit Committee is required by the rules of the
Securities and Exchange Commission. It is not to be deemed incorporated by
reference by any general statement which incorporates by reference this Proxy
Statement into any filing under Securities Act of 1933 or the Securities
Exchange Act of 1934, and it is not to be otherwise deemed filed under either
such Act.

The Audit Committee has four members, all of which are independent
directors as defined by Section 303.01(B)(2)(a) and (3) of the New York Stock
Exchange Listed Company Manual: Richard K. Lochridge (Chairman), Leonard L.
Berry, Dawn Hudson, and Thomas D. O'Malley. The Audit Committee meets regularly
with (1) the internal auditing staff, (2) representatives of the Company's
independent accounting firm (Deloitte & Touche LLP, the member firms of Deloitte
Touche Tohmatsu, and their respective affiliates (collectively, "Deloitte"))
without senior management present and (3) representatives of senior management.
The Committee reviews the general scope of the Company's annual audit and the
fees charged by the independent accountants, determines duties and
responsibilities of the internal auditors, reviews financial statements and
accounting principles being applied, and reviews audit results and other matters
relating to internal control and compliance with the Company's code of ethics.

In carrying out its responsibilities, the Committee has

- reviewed and discussed the audited financial statements with management,

- discussed with the independent auditors the matters required to be
communicated to audit committees by Statement on Auditing Standards No.
61, and

- received the written disclosures and the letter from Deloitte required by
Independence Standards Board Standard No. 1 and has discussed with
Deloitte that firm's independence.

Based on the review and discussions noted above and the report of Deloitte
to the Audit Committee, the Audit Committee has recommended to the Board of
Directors that the Company's audited financial statements be included in the
Company's Annual Report on Form 10-K for the fiscal year ended February 1, 2002.

Richard K. Lochridge (Chairman)
Leonard L. Berry
Dawn Hudson
Thomas D. O'Malley

April 4, 2002

AUDIT FEES

The Audit Committee has reviewed and approved the following aggregate fees
billed to the Company during the fiscal year ended February 1, 2002 by the
Company's principal accounting firm Deloitte:

Audit Fees.................................................. $ 479,800
==========
Financial Information Systems Design and Implementation
Fees...................................................... $ 0
Audit Related Fees -- Fees for Consents, Comfort Letters and
for Audits of the Company's Employee Benefit Plans........ $ 265,800
Other Non-audit Related Fees -- Tax Fees.................... $ 303,124
----------
All Other Fees.............................................. $ 568,924
==========

The Committee has considered whether the provision of information
technology services and the services under the all other fees caption is
compatible with Deloitte's independence.

INDEPENDENT PUBLIC ACCOUNTANTS

Upon the recommendation of the Audit Committee, the Board of Directors has
reappointed Deloitte as independent auditors to audit the consolidated financial
statements of the Company and its subsidiaries for 2002. Deloitte has served in
such capacity continuously since 1982.

Representatives of Deloitte are expected to be present at the Annual
Meeting, where they will have the opportunity to make a statement, if they
desire to do so, and be available to respond to appropriate questions.

PROPOSAL 2

SHAREHOLDER PROPOSAL ON
GLOBAL WORKERS' RIGHTS STANDARDS

The second proposal to be voted upon at the Annual Meeting asks the
shareholders to consider a proposal of the Comptroller of the City of New York,
as custodian and trustee of the New York City Teachers, Employees, Fire and
Police Pension Funds (the "Pension Funds"), 1 Centre Street, New York, NY 10007-
2341, owner of 1,118,264 shares of the Company's Common Stock. The Pension Funds
along with Boston Trust's Walden/BBT Domestic Social Index Fund, 40 Court
Street, Boston, MA 02108, the owner of 2,300 shares of the Company's Common
Stock have offered the following proposal, which, to be approved, requires the
affirmative vote of the majority of shares of Common Stock represented at the
Annual Meeting:

LOWE'S COMPANIES -- GLOBAL HUMAN RIGHTS STANDARDS

Whereas, Lowe's currently has extensive overseas operations, and

Whereas, reports of human rights abuses in the overseas subsidiaries and
suppliers of some U.S.-based corporations has led to an increased public
awareness of the problems of child labor, "sweatshop" conditions, and the denial
of labor rights in U.S. corporate overseas operations, and

Whereas, corporate violations of human rights in these overseas operations
can lead to negative publicity, public protests, and a loss of consumer
confidence which can have a negative impact on shareholder value, and

Whereas, a number of corporations have implemented independent monitoring
programs with respected human rights and religious organizations to strengthen
compliance with international human rights norms in subsidiary and supplier
factories, and

Whereas, these standards incorporate the conventions of the United Nation's
International Labor Organization (ILO) on workplace human rights which include
the following principles:

1) All workers have the right to form and join trade unions and to bargain
collectively. (ILO Conventions 87 and 98)

2) Workers representatives shall not be the subject of discrimination and
shall have access to all workplaces necessary to enable them to carry
out their representation functions. (ILO Convention 135)

3) There shall be no discrimination or intimidation in employment. Equality
of opportunity and treatment shall be provided regardless of race,
color, sex, religion, political opinion, age, nationality, social
origin, or other distinguishing characteristics. (ILO convention 100 and
111)

4) Employment shall be freely chosen. There shall be no use of force,
including bonded or prison labor. (ILO conventions 29 and 105)

5) There shall be no use of child labor. (ILO Convention 138), and,

Whereas, independent monitoring of corporate adherence to these standards
is essential if consumer and investor confidence in our company's commitment to
human rights is to be maintained,

Therefore, be it resolved that the shareholders request that the company
commit itself to the implementation of a code of corporate conduct based on the
aforementioned ILO human rights standards by

its international suppliers and in its own international production facilities
and commit to a program of outside, independent monitoring of compliance with
these standards.

COMPANY RESPONSE

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE
"AGAINST" THE GLOBAL WORKERS' RIGHTS STANDARDS PROPOSAL FOR THE FOLLOWING
REASONS:

This is the second year that this proposal (with a few non-substantive
changes this year) has been offered by the Comptroller of the City of New York.
This year the proposal is also submitted by Walden/BBT Domestic Social Index
Fund. Even though the proposal received the favorable vote of only 9.7% of the
shares voted at the 2001 annual meeting, rules of the Securities and Exchange
Commission require the Company to include the proposal as a matter to be
presented at this year's annual meeting. The proponents have submitted the
proposal notwithstanding that, in the intervening year, to the Company's
knowledge there have been no charges concerning these alleged abuses involving
the Company or its suppliers.

As noted in last year's statement opposing the proposal, the Company has
long supported human rights in the workplace, and the Company's policies and
procedures have reflected those values for many years. The Company's Code of
Ethics, its Statement of Business Ethics, and its buying agreements with
domestic and international suppliers require all suppliers and suppliers'
vendors not to use child or forced labor and to comply with applicable laws and
regulations in the production of goods and services for, and in their conduct of
business with, the Company. The Company is committed, and expects its suppliers
to be similarly committed, to operating within the spirit and letter of laws and
regulations affecting the Company's business and employees.

To fulfill its commitment, beginning in 1997 the Company implemented a
five-part compliance program for its international suppliers consisting of (i)
informing suppliers of the Company's policy, (ii) inquiring into suppliers'
policies, (iii) verifying suppliers' responses to the Company's inquiries, (iv)
entering into contracts containing representations on this issue, and (v)
randomly and periodically inspecting suppliers' manufacturing facilities for
compliance during contract fulfillment.

The Company regularly conducts seminars on the requirements of its Code of
Ethics and Statement of Business Ethics for the Company's merchants/buyers,
distributes its Code of Ethics and Statement of Business Ethics to management
employees, and outlines on a continuous basis its policies and procedures to
domestic and foreign suppliers. Through its buying agreements, the Company
obtains representations from suppliers (both domestic and international) that
they, and their vendors, do not permit the use of child or forced labor and that
their operations comply with all applicable laws and regulations.

Because of the Company's high ethical standards and ongoing efforts in
these areas, the Company does not believe that adoption of the standards in the
shareholder proposal is necessary. Further, the proposal calls for third party
monitoring of compliance by the Company, its suppliers, and their vendors, which
would require expenditures beyond any benefit such third party compliance
procedures reasonably could be expected to provide.

FOR THESE REASONS, THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
A VOTE "AGAINST" THIS SHAREHOLDER PROPOSAL.

PERFORMANCE GRAPH

The following graph compares the total returns (assuming reinvestment of
dividends) of the Company's Common Stock, the S&P 500 Index and the S&P Retail
Index. The graph assumes $100 invested on January 31, 1997, in the Company's
Common Stock and each of the indices.

(PERFORMANCE GRAPH)

-------------------------------------------------------------------------------------------------------------
1/31/97 1/30/98 1/29/99 1/28/00 2/2/01 2/1/02
-------------------------------------------------------------------------------------------------------------

LOWE'S $100.00 $152.64 $352.07 $269.06 $325.07 $551.85
S&P 500 $100.00 $124.69 $162.77 $173.01 $171.65 $142.74
S&P RETAIL INDEX $100.00 $147.32 $245.15 $267.31 $267.87 $288.93

Source: Bloomberg Financial Services

GENERAL

The cost of solicitations of proxies will be borne by the Company. In
addition to the use of the mail, proxies may be solicited personally, by
telephone, by telegraph or by certain employees of the Company. The Company may
reimburse brokers or other persons holding stock in their names or in the names
of nominees for their expense in sending proxy materials to principals and
obtaining their proxies. The Company has engaged the proxy soliciting firm of D.
F. King & Co., Inc. to solicit proxies for the Annual Meeting at an anticipated
cost of $8,500 (plus handling fees).

Where a choice is specified with respect to any matter to come before the
meeting, the shares represented by the proxy will be voted in accordance with
such specifications.

Where a choice is not so specified, the shares represented by the proxy
will be voted "FOR" proposal 1 and "AGAINST" proposal 2 as set forth in the
Notice of Annual Meeting and Proxy Card.

Management is not aware that any matters other than those specified herein
will be presented for action at the meeting, but if any other matters do
properly come before the meeting, the persons named as Proxies will vote upon
such matters in accordance with their best judgment.

In the election of Directors, a specification to withhold authority to vote
for the slate of management nominees will not constitute an authorization to
vote for any other nominee.

SHAREHOLDER PROPOSALS
FOR THE 2003 ANNUAL MEETING

Proposals of shareholders intended to be presented at the 2003 Annual
Meeting must be received by the Board of Directors for consideration for
inclusion in the Proxy Statement and form of proxy relating to that meeting on
or before December 15, 2002. In addition, if the Company receives notice of a
shareholder proposal after March 1, 2003, the persons named as Proxies in the
Proxy Statement for the 2003 Annual Meeting will have discretionary voting
authority to vote on such proposal at the 2003 Annual Meeting.

ANNUAL REPORT

The Annual Report to shareholders accompanies this Proxy Statement. The
Company's report to the Securities and Exchange Commission on Form 10-K for the
Fiscal Year ended February 1, 2002 is available upon written request addressed
to Lowe's Companies, Inc., Investor Relations Department, P. O. Box 1111, North
Wilkesboro, NC 28656.

By order of the Board of Directors,

/s/ Stephen A. Hellrung
Stephen A. Hellrung
Senior Vice President, General Counsel
& Secretary

Wilkesboro, North Carolina
April 15, 2002

APPENDIX A
AUDIT COMMITTEE CHARTER

AMENDED AND RESTATED APRIL 5, 2002

LOWE'S COMPANIES, INC.
BOARD OF DIRECTORS AUDIT COMMITTEE
CHARTER

MISSION

The Audit Committee is established by the Board as an independent and
objective Committee of the Board of Directors. Its primary function is to assist
the Board of Directors in monitoring (1) the integrity of the financial
statements of the Company, (2) compliance by the Company with its established
internal controls, legal and regulatory requirements and (3) the independence
and performance of the Company's internal and external auditors.

COMPOSITION

The Audit Committee shall consist of at least three (3) directors who shall
be appointed in accordance with the Bylaws of the Company. The members of the
Audit Committee shall meet the independence and experience requirements of the
New York Stock Exchange. In particular, the Chairperson shall have accounting or
related financial management expertise. The Committee shall meet at such times
as it deems necessary.

AUTHORITY

The Committee is authorized to have full and unrestricted access to all
personnel, records, operations, properties, and other informational sources of
the Company as required to properly discharge its responsibilities. Further, the
Committee is granted the authority to investigate any activity of the Company,
and all employees are directed to cooperate as requested by members of the
Committee. The Committee will also be empowered to retain outside counsel or
persons having special competencies as necessary to assist the Committee in
fulfilling its responsibility. The Audit Committee shall make regular reports to
the Board of Directors of the Company.

DUTIES AND RESPONSIBILITIES

The Audit Committee shall:

1. Provide a focal point for communication between the independent auditor,
Internal Audit, management and the Board of Directors.

2. Review and reassess the adequacy of this Charter annually and submit it
to the Board for approval.

3. Review the annual audited financial statements with management,
including major issues regarding accounting and auditing principles and
practices, as well as the adequacy of internal controls that could
significantly affect the Company's financial statements.

4. Conduct a review with management and the independent auditor of the
Company's quarterly financial statements prior to the filing of its Form
10-Q, including the results of the independent auditor's review of the
quarterly financial statements.

A-1

5. Review with management and the independent auditor at least annually the
effect of significant regulatory and accounting initiatives, as well as
off-balance sheet structures on the Company's financial statements.

6. Discuss with management, the independent auditor, and Internal Audit
their qualitative judgments about the appropriateness, not just the
acceptability, of accounting principles and financial disclosure
practices used or proposed to be adopted by the Company, particularly
the degree of aggressiveness or conservatism of its accounting
principles and underlying estimates.

7. Meet periodically with management to review the Company's major
financial risk exposures and the steps management has taken to monitor
and control such exposures.

8. As necessary, review an analysis prepared by management and the
independent auditor of significant financial reporting issues and
judgments made in connection with the preparation of the Company's
financial statements.

9. Review major changes to the Company's auditing and accounting principles
and practices as suggested by the independent auditor, internal auditors
or management.

10. With respect to the independent public accountants, the Committee
shall:

-- Recommend to the Board the appointment of the independent auditor,
which firm is ultimately accountable to the Audit Committee and the
Board.

-- Approve the fees to be paid to the independent auditor for audit
services.

-- Approve any change of the lead client service/audit partner.

-- Review with the senior audit partner and management the experience
and qualifications of the senior members of the independent auditor
team and the quality control procedures of the independent auditor.

-- Approve the retention of the independent auditor for any non-audit
or non-audit related service, other than accounting or tax
services, and the fee for such service.

-- Receive periodic reports from the independent auditor regarding the
auditor's independence, discuss such reports with the auditor, and
if so determined by the Audit Committee, recommend that the Board
take appropriate action to insure the independence of the auditor.

-- Review the scope and general extent of the independent public
accountants' audit examination prior to the annual audit. This
review should also include the Vice President of Internal Audit's
evaluation of the performance of the independent accountants,
including the degree of audit coordination and overall audit
coverage.

-- Discuss with the independent auditor the matters required to be
discussed by Statement of Auditing Standards No. 61 relating to the
conduct of the audit.

11. Review and concur in the appointment, annual performance appraisal,
replacement, reassignment or discharge of the Vice President of
Internal Audit.

12. The Company may not hire employees of the independent auditor who have
been engaged on the Company's account without the prior approval of the
Committee.

A-2

13. Review with the Vice President of Internal Audit the department's
scope, staffing, training/development, budget and audit schedule. This
review should include the risk assessment upon which the audit schedule
was developed, as well as plans for reviews of the Company's
information systems, procedures and controls. The Committee shall
review and approve the initial audit plan and any significant
subsequent changes in the plan, the results of internal audit
activities, including the independence, objectivity and qualifications
of the internal audit staff, and periodically review and approve the
Internal Audit Department's charter.

14. Review with the independent auditor any problems or difficulties the
auditor may have encountered and any management letter provided by the
auditor and the Company's response to that letter. Such review should
include:

(a) Any difficulties encountered in the course of the audit work,
including any restrictions on the scope of activities or access to
required information, and any disagreements with management.

(b) Any changes required in the planned scope of the internal audit.

15. Prepare the report required by the rules of the Securities and Exchange
Commission to be included in the Company's annual proxy statement.

16. Review management's monitoring of compliance with the Company's Code of
Ethics, including disclosures of insider and affiliated party
transactions, and conduct or monitor any special investigations of
conflict of interest and compliance with federal, state and local laws
and regulations as may be warranted.

17. Obtain reports from management and the Company's senior internal
auditing executive that the Company is in conformity with applicable
accounting requirements, internal controls and the Company's Code of
Ethics.

18. Review with the Company's General Counsel legal matters that may have a
material impact on the financial statements, the Company's compliance
policies and any material reports or inquiries received from regulators
or governmental agencies.

19. Meet at least annually with the chief financial officer, the senior
internal auditing executive and the independent auditor in separate
executive sessions.

While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate and are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent auditor. Nor is it
the duty of the Audit Committee to conduct investigations, to resolve
disagreements, if any, between management and the independent auditor or to
assure compliance with laws and regulations and the Company's Code of Ethics.

A-3

DIRECTIONS TO THE PARK HOTEL

FROM CHARLOTTE DOUGLAS INTERNATIONAL AIRPORT:

Take airport freeway to Billy Graham Parkway South. Follow Billy Graham until
the road name changes to Woodlawn Road. Cross 3 intersections (Old Pineville
Road, South Boulevard and Park Road). Woodlawn becomes Runnymede at the
intersection of Selwyn Avenue. Continue straight on Runnymede. At the second
light turn right onto Colony Road. Turn right onto Roxborough Road. Turn right
onto Rexford, and The Park Hotel is on the left.

FROM I-85 NORTH:

Take Billy Graham Parkway exit #33. Follow Billy Graham until the road name
changes to Woodlawn Road. Cross 3 intersections (Old Pineville Road, South
Boulevard and Park Road). Woodlawn becomes Runnymede at the intersection of
Selwyn Avenue. Continue straight on Runnymede. At the second light turn right
onto Colony Road. Turn right onto Roxborough Road. Turn right onto Rexford, and
The Park Hotel is on the left.

FROM I-85 SOUTH:

FROM I-77 SOUTH:

Take exit #5, Tyvola Road and turn left at the end of the ramp. Continue on
Tyvola Road. At the intersection of Park Road and Tyvola Road, cross Park Road,
Tyvola becomes Fairview Road. Continue on Fairview. At Barclay Downs (First
Union is on the left) turn left. Turn right at the light (second intersection)
onto Morrison Boulevard. Turn left onto Coca-Cola Boulevard (first left). Turn
right onto Rexford Road, The Park Hotel is on the right.

(RECYCLED PAPER LOGO)

LOWES-PS-02

COMMON STOCK LOWE'S COMPANIES, INC. COMMON STOCK

P.O. Box 1111, North Wilkesboro, NC 28656
This Proxy is Solicited on Behalf of the Board of Directors.

The undersigned hereby appoints Stephen A. Hellrung and Robert A. Niblock as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and vote, as designated on the reverse side, all the shares of
Common Stock of Lowe's Companies, Inc. held of record by the undersigned on
April 1, 2002, at the Annual Meeting of Shareholders to be held on May 31,
2002, or any adjournment thereof. The Board of Directors recommends a vote FOR
Proposal 1 and a vote AGAINST Proposal 2.

This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made, this proxy will be
voted FOR Proposal 1 and AGAINST Proposal 2.

--------------------------------------------------------------------------------
Please sign exactly as your name appears on the books of the Company. Joint
owners should each sign personally. Trustees and other fiduciaries should
indicate the capacity in which they sign, and where more than one name appears,
a majority must sign. If a corporation, this signature should be that of an
authorized officer who should state his or her title.
--------------------------------------------------------------------------------

HAS YOUR ADDRESS CHANGED? If so, please provide your new address.
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

PROXY VOTING INSTRUCTIONS
Lowe's Companies, Inc. encourages all stockholders to vote. We provide three
convenient methods for voting listed below:

-------------------
1. Vote by Internet
-------------------
It's fast, convenient, and your vote is immediately
confirmed and posted.
Follow these four easy steps:
--------------------------------------------------------
1. Read the accompanying Proxy Statement and Proxy Card.
2. Go to the Website
http://www.eproxyvote.com/low
3. Enter your Control Number located on your Proxy Card.
4. Follow the instructions provided.
--------------------------------------------------------
Your vote is important!
Go to http://www.eproxyvote.com/low anytime!

--------------------
2. Vote by Telephone
--------------------
It's fast, convenient, and immediate!
Call Toll-Free on a Touch-Tone Phone
Follow these four easy steps:
---------------------------------------------------------
1. Read the accompanying Proxy Statement and Proxy Card.
2. Call the toll-free number
1-877-PRX-VOTE (1-877-779-8683).
There is NO CHARGE for this call.
3. Enter your Control Number located on your Proxy Card.
4. Follow the recorded instructions.
---------------------------------------------------------
Your vote is important!
Call 1-877-PRX-VOTE anytime!

Do not return your Proxy Card if you are voting by Telephone or Internet

---------------
3. Vote by Mail
---------------
Complete, sign, date and return the Proxy Card attached above in the enclosed
envelope.

RECEIVE FUTURE PROXY MATERIALS ELECTRONICALLY. Receiving stockholder material
electronically reduces mailing and printing costs and is better for the
environment. Would you like to receive future proxy materials electronically? If
so go to http://www.econsent.com/low and follow the instructions provided.
Stockholders who elect this option will be notified each year by e-mail how to
access the proxy materials and how to vote their shares on the Internet.

You may access Lowe's Companies, Inc's. 2001 Annual Report at:
www.lowes.com/annualreport and Proxy Statement at: www.lowes.com/proxy

[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE

--------------------------------------------------------------------------------
LOWE'S COMPANIES, INC.
--------------------------------------------------------------------------------

Common Stock

Mark box at right if an address change has been noted on the [ ]
reverse side of this card.

CONTROL NUMBER:

--------------------------------------------------------------------------------
The Board of Directors recommends a vote FOR proposal 1.
--------------------------------------------------------------------------------

1. Election of Directors. Nominees: For All With- For All
Nominees hold Except
CLASS I DIRECTORS
(Three-year Term 2002-2005) [ ] [ ] [ ]
(01) Robert A. Ingram
(02) Richard K. Lochridge
(03) Claudine B. Malone

NOTE: If you do not wish your shares voted "For" a particular nominee, mark
the "For All Except" box and strike a line through the name(s) of the
nominee(s). Your shares will be voted for the remaining nominee(s).

--------------------------------------------------------------------------------
The Board of Directors recommends a vote AGAINST proposal 2.
--------------------------------------------------------------------------------

For Against Abstain

3. Shareholder proposal concerning global workplace [ ] [ ] [ ]
labor standards.

In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.

Mark here if you plan to attend the meeting. [ ]

---------------------------
Please be sure to sign and date this Proxy. Date
--------------------------------------------------------------------------------

--------------Shareholder sign here----------------Co-owner sign here-----------

--------------------------------------------------------------------------------
DETACH CARD DETACH CARD

Important Proxy voting instructions on reverse side.

ESOP/401(k) LOWE'S COMPANIES, INC. ESOP/401(k)

P.O. Box 1111, North Wilkesboro, NC 28656
This Proxy is Solicited on Behalf of the Board of Directors.

TO: STATE STREET BANK AND TRUST COMPANY, TRUSTEE OF THE LOWE'S COMPANIES
EMPLOYEE STOCK OWNERSHIP PLAN ("ESOP") AND 401(k) PLAN ("401(k)")

As a participant in either or both the Lowe's Companies ESOP or 401(k), I direct
State Street Bank and Trust Company, Trustee of each plan, to vote the shares of
Lowe's Companies, Inc. Common Stock allocated to my ESOP or 401(k) accounts at
the Annual Meeting of Shareholders to be held on May 31, 2002, and at any
adjournment thereof, in accordance with the direction on the reverse side of
this card. Any allocated shares for which no written instructions are timely
received and any unallocated shares held in the trust will be voted by the
Trustee in the manner directed by the Lowe's Companies ESOP Committee and
401(k) Management Committee. The Board of Directors recommends a vote FOR
Proposal 1 and a vote AGAINST Proposal 2.

--------------------------------------------------------------------------------
PLEASE MARK, SIGN AND DATE ON REVERSE SIDE AND RETURN THIS VOTING
INSTRUCTION CARD PROMPTLY USING THE ENCLOSED ENVELOPE, OR
FOLLOW INSTRUCTIONS TO VOTE BY TELEPHONE OR INTERNET.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Please sign exactly as your name appears on the books of the Company. Joint
owners should each sign personally. Trustees and other fiduciaries should
indicate the capacity in which they sign, and where more than one name appears,
a majority must sign. If a corporation, this signature should be that of an
authorized officer who should state his or her title.
--------------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED? If so, please provide your new address.
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

PROXY VOTING INSTRUCTIONS
Lowe's Companies, Inc. encourages all stockholders to vote. We provide three
convenient methods for voting listed below:

Do not return your Proxy Card if you are voting by Telephone or Internet

---------------
3. Vote by Mail
---------------
Complete, sign, date and return the Proxy Card attached above in the enclosed
envelope.

You may access Lowe's Companies, Inc's. 2001 Annual Report at:
www.lowes.com/annualreport and Proxy Statement at: www.lowes.com/proxy

[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE

--------------------------------------------------------------------------------
LOWE'S COMPANIES, INC.
--------------------------------------------------------------------------------

ESOP/401(k)

Mark box at right if an address change has been noted on the [ ]
reverse side of this card.

CONTROL NUMBER:
ESOP:
401(k):

For Against Abstain

2. Shareholder proposal concerning global workplace [ ] [ ] [ ]
labor standards.

In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.

---------------------------
Please be sure to sign and date this Proxy. Date
--------------------------------------------------------------------------------

--------------Shareholder sign here----------------Co-owner sign here-----------

--------------------------------------------------------------------------------
DETACH CARD DETACH CARD

Important Proxy voting instructions on reverse side.