<PAGE>
BIG DOG HOLDINGS, INC.
121 GRAY AVENUE
SANTA BARBARA, CA 93101
OFFER TO PURCHASE FOR CASH
UP TO 3,500,000 SHARES OF COMMON STOCK
OF
BIG DOG HOLDINGS, INC.
AT
$6.25 NET PER SHARE
-------------------------------------------------------------------------------
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 9:00 A.M.,
PACIFIC TIME, ON WEDNESDAY, AUGUST 30, 2000, UNLESS THE OFFER IS EXTENDED.
-------------------------------------------------------------------------------
To Brokers, Dealers, Commercial Banks,
Trust Companies and other Nominees:
We are enclosing the material listed below relating to the offer by Big
Dog Holdings, Inc., a Delaware corporation (the "Company"), to purchase up to
3,500,000 shares of its common stock, par value $.01 per share, at a price of
$6.25 per share, net to the seller in cash, upon the terms and subject to the
conditions set forth in the offer to purchase dated July 31, 2000 and the
related letter of transmittal (which together constitute the "offer").
We are asking you to contact your clients for whom you hold shares
registered in your name (or in the name of your nominee) or who hold shares
registered in their own names. Please bring the offer to their attention as
promptly as possible. No fees or commissions will be payable to brokers, dealers
or other persons for soliciting tenders of shares pursuant to the offer. The
Company will, however, upon request, reimburse you for customary mailing and
handling expenses incurred by you in forwarding any of the enclosed materials to
your clients. The Company will pay all stock transfer taxes on its purchase of
shares, subject to Instruction 6 of the letter of transmittal.
Enclosed herewith are copies of the following documents:
1. Offer to Purchase, dated July 31, 2000;
2. Letter of Transmittal;
3. Guidelines for Certification of Taxpayer Identification Number
on Substitute Form W-9;
4. Notice of Guaranteed Delivery;
5. Form of letter which may be sent to your clients for whose
account you hold shares in your name or in the name of your nominee, with space
provided for obtaining such clients' instructions with regard to the offer; and
<PAGE>
6. Return envelope addressed to the depositary.
We urge you to contact your clients promptly. Please note that, unless
extended, the offer, proration period and withdrawal rights will expire at 9:00
a.m., Pacific time, on Wednesday, August 30, 2000.
The offer is not being made to, nor will tenders be accepted from, or
on behalf of, holders of shares residing in any jurisdiction in which the making
or acceptance thereof would not be in compliance with the laws of such
jurisdiction.
As described in the offer to purchase, if more than 3,500,000 shares are
validly tendered and not withdrawn prior to the "expiration date," as defined in
Section 1 of the offer to purchase, the Company will accept shares for purchase
in the following order of priority: (i) all shares validly tendered and not
withdrawn prior to the expiration date by any stockholder who owned
beneficially, as of the close of business on July 31, 2000 and who continues to
own beneficially as of the expiration date, an aggregate of fewer than 100
shares and who validly tenders all of such shares (partial tenders will not
qualify for this preference) and completes the box captioned "Odd Lots" in the
letter of transmittal; and (ii) after purchase of all of the foregoing shares,
all other shares validly tendered and not withdrawn prior to the expiration date
on a pro rata basis.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER. HOWEVER,
STOCKHOLDERS MUST MAKE THEIR OWN DECISION WHETHER TO TENDER SHARES AND, IF SO,
HOW MANY SHARES TO TENDER. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES
ANY RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM
TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT EACH OF ITS DIRECTORS AND
OFFICERS WHO OWN SHARES INTENDS TO TENDER SHARES IN THE OFFER.
Additional copies of the enclosed material may be obtained from the
undersigned. Any questions you may have with respect to the offer should be
directed to the undersigned at its address and telephone number set forth in the
enclosed offer to purchase.
Very truly yours,
Big Dog Holdings, Inc.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE
YOU AS THE AGENT OF THE COMPANY OR THE DEPOSITARY, OR AUTHORIZE YOU TO USE ANY
DOCUMENT OR MAKE ANY STATEMENT ON THEIR BEHALF IN CONNECTION WITH THE OFFER
OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.
2
