UNITED STATES

SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549




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FORM 10-K



|    |                                                     
|--- | ----------------------------------------------------
|[X] | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934


For the fiscal year ended January 30, 2000.



|      |                                                                                          
|----- | -----------------------------------------------------------------------------------------
|[   ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934

Commission File Number 001-13927

CSK AUTO CORPORATION

(Exact name of registrant as specified in its
charter)


|                                                 |  |                    
|------------------------------------------------ |  | -------------------
|                                                
|                                                
|                                                
|                                                
|Delaware                                         |  | 86-0765798         
|(State or other jurisdiction of                  |  | (I.R.S. Employer   
|Incorporation or organization)                   |  | Identification No.)
|                                                
|645 E. Missouri Ave. Suite 400, Phoenix, Arizona |  | 85012              
|(Address of principal executive offices)         |  | (Zip Code)         

Securities registered pursuant to Section 12(b) of the
Act:

|                             |  |                        
|---------------------------- |  | -----------------------
|                             |  | Name of each exchange  
|Title of each class          |  | on which registered:   
|                             |  |                        
|Common Stock, $.01 par value |  | New York Stock Exchange

Securities registered pursuant to Section 12(g) of the
Act: None

Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d)
 of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject
 to such filing requirements for the past
90 days.  Yes  [X]  No  [   ]

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained
herein, and will not be contained, to the best of the
registrants knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this
Form 10-K or any amendment to this
Form 10-K.  [   ]

As of April 18, 2000, the aggregate market value of the
Companys common stock held by non-affiliates was
approximately $156.6 million. For purposes of the above statement
 only, all directors and executive officers of the registrant are
 assumed to be affiliates. As of April 18, 2000, there were
27,837,558 shares of the Companys common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE



| |   |                                                                                                                                                                                                            
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Portions of the Companys definitive Proxy Statement on
	Schedule 14A, with respect to the Companys 2000 Annual
	 Meeting of Stockholders, are incorporated by reference into
	Part III of this Form 10-K.



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TABLE OF CONTENTS

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|PART I    |  |                                                                                        |  |      |    | 
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|Item  1.  |  | Business                                                                               |  |      | 2  | 
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|Item  2.  |  | Properties                                                                             |  |      | 12 | 
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|Item  3.  |  | Legal Proceedings                                                                      |  |      | 13 | 
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|Item  4.  |  | Submission of Matters to a Vote of Security Holders                                    |  |      | 14 | 
|PART II   |  |                                                                                        |  |      |    | 
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|Item  5.  |  | Market for Registrants Common Stock and Related Stockholder
	 Matters                 |  |      | 14 | 
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|Item  6.  |  | Selected Consolidated Financial Data                                                   |  |      | 15 | 
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|Item  7.  |  | Managements Discussion and Analysis of Financial Condition
	and Results of Operations |  |      | 18 | 
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|Item  7A  |  | Quantitative and Qualitative Disclosures about Market Risk                             |  |      | 28 | 
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|Item  8.  |  | Consolidated Financial Statements and Supplementary Data                               |  |      | 28 | 
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|Item  9.  |  | Changes in and Disagreements with Accountants on Accounting and
	Financial Disclosure  |  |      | 58 | 
|PART III  |  |                                                                                        |  |      |    | 
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|Item  10. |  | Directors and Executive Officers of the Registrant                                     |  |      | 58 | 
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|Item  11. |  | Executive Compensation                                                                 |  |      | 58 | 
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|Item  12. |  | Security Ownership of Certain Beneficial Owners and Management                         |  |      | 58 | 
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|Item  13. |  | Certain Relationships and Related Transactions                                         |  |      | 58 | 
|PART IV   |  |                                                                                        |  |      |    | 
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|Item  14. |  | Exhibits, Financial Statement Schedules and Reports on Form 8-K                        |  |      | 58 | 

Note Concerning Forward-Looking Information

Some of the information in this Report on Form 10-K contains
 forward-looking statements that involve substantial risks and
uncertainties. You can identify these statements by
forward-looking words such as may, will,
expect, anticipate, believe,
estimate and continue or similar words.
You should read statements that contain these words carefully
because they: (1) discuss our future expectations;
(2) contain projections of our future results of operations
or of our financial condition; or (3) state other
forward-looking information. We believe that it is
important to communicate our future expectations to our
investors. However, there may be events in the future that we are
 not able to accurately predict or over which we have no control,
 the occurrence of which could have a material adverse effect on
our business, operating results and financial condition. These
events may include future operating results, our efforts to
address Year 2000 issues and potential competition, among other
things. Factors that might cause actual results to differ
materially from those in such forward-looking statements include,
 but are not limited to, those discussed in Item 7.
Managements Discussion and Analysis of Financial Condition
and Results of Operations.

1



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PART I

Item 1.  Business

General

We are the largest retailer of automotive parts and accessories
in the Western United States and one of the largest retailers of
such products in the United States based, in each case, on our
number of stores. As of January 30, 2000, we operated 1,120
stores as one fully integrated company under three brand names:



| |   |                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------
| |  | Checker Auto Parts, founded in 1969 and operating in the
	Southwestern, Rocky Mountain and Northern Plains states;
|
| |  | Schucks Auto Supply, founded in 1917 and operating in the
	Pacific Northwest; and                                
|
| |  | Kragen Auto Parts, founded in 1947 and operating primarily in
	California.                                        

We offer a broad selection of national brand name and private
label automotive products for domestic and imported cars, vans
and light trucks. Our products include new and remanufactured
automotive replacement parts, maintenance items and accessories.
Most of our sales are to do-it-yourself customers, although our
commercial sales program, focusing on sales to auto repair
professionals and fleet owners, represents a significant and
increasing part of our business. Our stores typically offer
between 13,000 and 17,000 stock-keeping units, or SKUs. Our
operating strategy is to offer our products at everyday low
prices and at conveniently located and attractively designed
stores, supported by highly trained, efficient and courteous
customer service personnel.

Recent Transactions

During March 2000, we entered into a definitive agreement to
 acquire substantially all of the assets of All-Car Distributors,
 Inc. (AllCar), an operator of 22 stores in
Wisconsin and Michigan. Under the terms of the agreement, we will
 pay approximately $865,000 in cash for the assets of AllCar and
will assume vendor accounts payable and certain indebtedness and
accrued expenses. The closing, which is subject to the
satisfaction of certain conditions, is expected to occur on
April 27, 2000. The acquisition of the 22 AllCar stores
 gives us an immediate presence of scale in a strategically
important market adjacent to our current operations. The acquired
 stores will be serviced out of our Minneapolis Distribution
Center and will be converted to the Checker Auto Parts name.

During January 2000, we entered into a definitive agreement
with Advance Auto Parts and Sequoia Capital to form a new joint
venture, PartsAmerica.com, which is expected to become one of the
 largest automotive parts and accessories e-commerce destinations
 in the $90 billion automotive parts and accessories market.
PartsAmerica.com will operate independently from its partners and
 will utilize both CSKs and Advances existing
logistic systems to support its web-based operations.
PartsAmerica.com will offer both retail and commercial customers
the widest available selection of automotive parts and delivery
options, including same-day delivery, local in-store pickup, and
overnight shipment. In addition, because of 50-state coverage,
customers will be able to return or exchange merchandise at their
 local CSK or Advance Auto Parts store. We have contributed the
use of the e-commerce capabilities of our existing web site and
certain other assets to the joint venture. We are a party to a
service agreement with PartsAmerica.com that governs the terms of
 our sale of merchandise to PartsAmerica.com and certain other
services that we are to provide to the joint venture.
PartsAmerica.com is expected to commence operations in
July 2000.

On October 1, 1999, we acquired the common stock of
Als and Grand Auto Supply, Inc. (AGA), formerly
 known as PACCAR Automotive, Inc., which operated 194 stores
 under the trade names of Als Auto Supply and Grand Auto
Supply (collectively, the AGA stores) in Washington,
California, Idaho, Oregon, Nevada and Alaska. We paid
approximately $145.6 million in cash for the stock of AGA and
associated transaction costs. The acquisition was funded with
proceeds from our senior credit facility. In connection with the
acquisition, we amended and restated our senior credit facility
to provide an additional $150.0 million of

2



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On September 7, 1999, we acquired all of the common stock of
 Automotive Information Systems, Inc. (AIS). AIS,
based in St. Paul, Minnesota, is a leading provider of diagnostic
 vehicle repair information to automotive technicians, automotive
 replacement parts manufacturers, automotive test equipment
manufacturers, and the do-it-yourself consumer. We paid
approximately $10.3 million in cash for AIS and funded the
acquisition through our senior credit facility.

On June 30, 1999, we acquired substantially all of the
assets of Apsco Products Company dba Big Wheel/ Rossi (Big
Wheel), which operated 86 stores under the trade name
of Big Wheel/ Rossi in Minnesota, North Dakota and Wisconsin
along with a distribution center in Minnesota. We paid
approximately $62.7 million in cash for substantially all the
assets and assumed certain liabilities and indebtedness of Big
Wheel. The acquisition was funded with proceeds from our senior
credit facility. In connection with the acquisition, we amended
and restated our senior credit facility to provide an additional
$125.0 million of senior term loan borrowing ability. We have
substantially converted the stores to the Checker name and store
format and integrated these stores into our operations.

Automotive Aftermarket Industry

We are a retailer of aftermarket automotive products such as
replacement parts, maintenance items and accessories. The term
aftermarket distinguishes our sales from those items sold as part
 of the original sale of a car or truck. We believe that the
automotive aftermarket for these items is growing because of
increases in:



| |   |                                                                 
| | - | ----------------------------------------------------------------
| |  | The size and age of the countrys automotive fleet;             
|
| |  | The number of miles driven annually per vehicle;                
|
| |  | The purchase prices of new cars;                                
|
| |  | The cost of replacement parts; and                              
|
| |  | Labor costs associated with parts, installation and maintenance.

There are many companies selling automotive aftermarket products.
 We believe, however, that the industry is consolidating as
national and regional specialty retail chains gain market share
at the expense of smaller independent retailers and less
specialized mass merchandisers. Automotive specialty retailing
chains like ours, which have multiple locations in a given market
 area, enjoy competitive advantages in purchasing, distribution,
advertising and marketing compared to most small independent
retailers. In addition, the recent significant increase in the
variety of domestic and imported vehicle makes and models has
increased the number of automotive replacement parts. This makes
it difficult for smaller independent retailers and less
specialized mass merchandise chains to maintain inventory
selection broad enough to meet customer demands. We believe this
has created a competitive advantage for us and for other
automotive specialty retailing chains that have the distribution
capacity and sophisticated information systems to stock and
deliver a large number of products in a timely manner.

Marketing and Merchandising Strategy

Our marketing and merchandising strategy is to build market share
 by providing a broad selection of national brand name and
private label products at everyday low prices. We offer these
products at conveniently located and attractively designed
stores, staffed by highly trained, efficient and courteous
employees.

Customer Service

We are a customer-oriented retailer dedicated primarily to
do-it-yourself consumers with a significant and increasing focus
on commercial customers. We try to enhance customer service by
use of our sophisticated product distribution and store support
systems, as well as our extensive training programs.

3



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We believe that the recruiting, training and retention of high
quality sales associates is required if our business is to be
successful. We operate training and incentive programs to
encourage the development of technical expertise by our sales
associates so they can effectively advise customers on product
selection and use.

CSK University, our sales associate development program, is
dedicated to the continuous education of store associates through
 structured on-the-job training and formal classroom instruction.
 The curriculum focuses on four areas of the associates
development:



| |   |                                 
| | - | --------------------------------
| |  | Customer service skills;        
|
| |  | Basic automotive systems;       
|
| |  | Advanced automotive systems; and
|
| |  | Management development.         

Much of the training is delivered through formal classes in 26
training centers that are fully equipped with the same systems as
 are in our stores. We believe that our training programs enable
sales associates to provide a high level of service to a wide
variety of customers ranging from less informed do-it-yourself
consumers to more sophisticated purchasers requiring diagnostic
advice. We also provide continuing training programs for store
managers and district managers designed to assist them in
increasing store-level efficiency and improving their potential
for promotion. In addition, we require periodic meetings of
district and store managers to facilitate and enhance
communications within our organization. Approximately 2,278 of
our current associates have passed the ASE-P2 test, a nationally
recognized certification for auto parts technicians.

In order to satisfy our customers, we adopted several service
initiatives including free testing of starters, alternators and
batteries; free charging of batteries; installation assistance
for batteries, windshield wipers and other selected products;
no hassle return policies; and electronically
maintained lifetime warranties, which eliminate the need for
consumer record keeping. Our significant investments in associate
 training and store-level information systems enable our in-store
 personnel to devote more time to attending to our
customers automotive needs.

Product Selection

Our stores have a broad selection of national brand name products
 in order to generate customer traffic and appeal to our
commercial customers. In addition, we stock a large selection of
high quality private label products that appeal to
value-conscious customers. Each store offers an extensive product
 line, including automotive replacement parts such as starters,
alternators, shock absorbers, mufflers, brakes, spark plugs,
filters and batteries, as well as a wide variety of maintenance
items, such as motor oil, lubricants, waxes, cleaners, polishes
and antifreeze. In addition, each store offers general
accessories such as car stereos, alarms, trim, floor mats, tools
and seat covers. Sales of replacement parts account for
approximately 60% of our sales. Replacement parts typically
generate higher gross profit margins than maintenance items or
general accessories. We are increasing our sales of replacement
parts, as a percentage of total sales, by offering a wider
selection of replacement parts and by increasing sales to
commercial customers.

Product Availability

Our stores offer between 13,000 and 17,000 SKUs of national brand
 name and private label automotive products. If a store does not
carry a specific part, store associates are able to use our
surround store inventory program to record the sale, reserve the
part and direct the customer to pick it up from a store in the
same market or at one of our nearby depots.

We continue to expand and improve our delivery system and we have
 increased our number of strategically located priority parts
depots to 44 and increased product selection through an increased
 SKU mix and access to our on-line local warehouse network. This
has led to better customer service by making available up to an
additional 200,000 products on a same-day delivery basis to over
75% of our stores and 1,000,000 additional products on a next-day
 delivery basis to all of our stores. This has also allowed us to
 increase sales to

4



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We have classified our product mix into 120 separate categories
through a merchandising program designed to determine the optimal
 inventory mix at each individual store based on that
stores historical sales. We believe that we can improve
store sales, gross profit margin and inventory turnover by
tailoring individual store inventory mix based on historical
sales patterns for each of the 120 product categories.

Pricing

Our pricing philosophy is that we should not lose a customer
because of price. Our pricing strategy is to offer everyday low
prices at each of our stores. Part of this strategy is to beat
any competitors lower price by 5%. As a result, we closely
monitor our competitors pricing levels through our
precision pricing program, which analyzes prices at the store
level rather than at the market or chain level. This initiative
enables us to establish pricing levels at each store based upon
that stores local market competition. Our entry-level
products offer excellent value by meeting standard quality
requirements at low prices. In addition, our sales associates are
 encouraged to offer alternative products at slightly higher
price points. These products typically provide extra features,
improved performance, an enhanced warranty or are of national
brand recognition.

Advertising

We support our marketing and merchandising strategy through print
 advertising, in-store promotional displays and an increasing
emphasis on radio and television advertising. The print
advertising consists of monthly color circulars that are produced
 by our in-house advertising department and that contain
redeemable coupons. We also advertise on radio, television and
billboards primarily to reinforce our image and name recognition.
 Television advertising is targeted to sports programming and
radio advertising is primarily aired during commuting hours.
Advertising efforts include Spanish language television and radio
 as well as bilingual store signage. In-store signs and displays
are used to promote products, identify departments, and to
announce store specials. We also sponsor two National Hot Rod
Association Funny Cars and have been designated the
Official Auto Parts Store of the NHRA. We have web
sites on the Internet at:



| |   |                                
| | - | -------------------------------
| |  | http://www.cskauto.com;        
|
| |  | http://www.checkerauto.com;    
|
| |  | http://www.schucks.com;        
|
| |  | http://www.kragen.com;         
|
| |  | http://www.identifix.com; and  
|
| |  | http://www.autoshop-online.com.

Store-Based Information Systems

Over the past several years, we have installed several
store-level information systems, which have improved store labor
productivity and customer service. These systems are described
below.

Electronic Parts Catalog

Our electronic parts catalog is a software-based system that
identifies the location and availability of over one and a half
million parts. The electronic parts catalog is a user-friendly
tool that enables our sales associates to assist customers in
parts selection and ordering based on simple input of the year,
model, engine type and application needed. Once provided with
this basic information, the electronic parts catalog displays
which part is needed and whether it is located in the store. In
the event a particular product is unavailable at a store, the
electronic parts catalog indicates whether it can be obtained at
a nearby store, priority parts depot, through

5



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| |   |                                                                                                                             
| | - | ----------------------------------------------------------------------------------------------------------------------------
| |  | Reducing checkout time by fully automating the ordering process
	between the parts counter and the point of sale register;  
|
| |  | Allowing the store associate to order parts electronically with
	immediate confirmation of availability and/or delivery; and
|
| |  | Providing up-to-the-minute pricing of products.                                                                             

Point of Sale System

We have installed a point of sale system consisting of cash
registers and sophisticated software in all of our stores, which
electronically record and report customer transactions and are
tied to our electronic parts catalog and the central inventory
system. This point of sale system improves store productivity and
 customer service by streamlining in-store procedures and
eliminating handwritten record keeping. This system also allows
for paperless transactions and electronic updating of warranty
information. In addition, the point of sale software tracks the
history of individual customer purchases for use in regionalized
marketing and merchandising programs.

Retail Paperless Management System

Our retail paperless management system is a store-based software
system used to improve store efficiency. This system provides for
 interactive store associate development and testing,
communication via company-wide e-mail, knowledge-based
interviewing of associate applicants, automated associate time
and attendance recording and forms automation.

Labor Scheduling System

We utilize a sophisticated labor scheduling system that allocates
 labor hours based on factors including forecasted sales and
customer traffic counts. We believe this system enables us to
provide superior customer service while providing for improved
labor productivity.

Satellite Communications Network

Our satellite communications network links all of our stores with
 our corporate office. The satellite network enables us to
efficiently obtain and deliver to our stores all file transfers,
including pricing down-loads, sales information updates and
interactive transactions such as electronic parts ordering. The
system also broadcasts common files to all stores simultaneously
to update our electronics parts catalog. In addition, the
satellite network significantly increases the speed of credit
card and check authorization.

Call Center

Our centralized call center provides store personnel at selected
high-volume stores the option to reroute customer calls to a
central location during the stores busiest hours of
operation. Call center associates perform all functions that
store personnel normally handle, such as store-specific parts
look-up, price look-up and inventory availability verification.
Associates in the call center can take an order from a customer
and electronically transmit it to the store, so that the customer
 can pick up the requested product at his local store. Use of the
 call center allows sales associates to give their undivided
attention to customers at the store while call-in customers are
serviced directly by call center associates.

6



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Diagnostic & Maintenance Repair Services

Through our subsidiary, AIS, we are a leading provider of
diagnostic vehicle repair information to automotive technicians,
automotive replacement parts manufacturers, automotive test
equipment manufacturers, and to the do-it-yourself consumer. This
 allows us to provide our retail, commercial, and Internet
customers with high quality diagnostic information available in
order to assist them with correctly identifying problems and
efficiently obtaining the parts they need.

AIS was founded in 1987 and markets its products and services
under the brand name IDENTIFIX. These products and services
include:



| |   |                                                              
| | - | -------------------------------------------------------------
| |  | Technical hotlines serving more than 15,000 automotive shops;
|
| |  | The RepairTrac Service Bulletin;                             
|
| |  | On-line diagrams containing over 50,000 wiring diagrams;     
|
| |  | Consulting services to automotive manufacturers; and         
|
| |  | Consumer services provided through our worldwide web sites.  

AIS has evolved into one of the leading sources of knowledge
about where and how vehicles break, and how to correctly repair
those vehicles. This extensive automotive knowledge comes from
(1) more than 250,000 calls received annually from
technicians seeking diagnostic assistance for vehicle repair;
(2) our staff of 32 Master Technicians who collectively have
 over 550 years of vehicle diagnostic experience; and
(3) a comprehensive on-site library of factory vehicle
service information.

In AISs 12 years of operation, it has developed a
customer base of more than 15,000 repair shops by providing
efficient and accurate information resources for automotive
diagnostics and repair. We are committed to supporting AISs
 existing customer base while developing new ways to deliver
information to their customers.

Store Operations

Our stores are divided into nine geographic regions: Southwest,
Rocky Mountain, Northwest, Northern Plains, Southern California,
Coastal California, Los Angeles, Pacific Coast and Northern
California. Each region is administered by a regional manager,
each of whom oversees seven to eleven district managers. Each of
our district managers has responsibility for between 4 and 17
stores.

7



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The table below sets forth, as of January 30, 2000, the
geographic distribution of our stores and the tradenames under
which they are or will be operated.

|             |       |            |    |             |  |            |     |         |  |  |     |     |  |  |     |       | 
|------------ | ----- | ---------- | -- | ----------- |  | ---------- | --- | ------- |  |  | --- | --- |  |  | --- | ----- | 
|             |       | Checker    |    | Schucks    |  | Kragen     |     | Company
|             |       | Auto Parts |    | Auto Supply |  | Auto Parts |     | Total  
|             |       |            |    |             |  |            |     |        
|California   |       |            | 1  |             |  |            | 2   |         |  |  | 454 |     |  |  | 457 |      
|            
|            
|            
|            
|Washington   |       |            |   |             |  |            | 168 |         |  |  |    |     |  |  | 168 |      
|            
|            
|            
|            
|Arizona      |       |            | 93 |             |  |            |    |         |  |  |    |     |  |  | 93  |      
|            
|            
|            
|            
|Colorado     |       |            | 68 |             |  |            |    |         |  |  |    |     |  |  | 68  |      
|            
|            
|            
|            
|Minnesota    |       |            | 65 |             |  |            |    |         |  |  |    |     |  |  | 65  |      
|            
|            
|            
|            
|Oregon       |       |            |   |             |  |            | 49  |         |  |  |    |     |  |  | 49  |      
|            
|            
|            
|            
|Utah         |       |            | 36 |             |  |            |    |         |  |  |    |     |  |  | 36  |      
|            
|            
|            
|            
|Idaho        |       |            | 7  |             |  |            | 25  |         |  |  |    |     |  |  | 32  |      
|            
|            
|            
|            
|Nevada       |       |            | 25 |             |  |            |    |         |  |  | 6   |     |  |  | 31  |      
|            
|            
|            
|            
|New Mexico   |       |            | 28 |             |  |            |    |         |  |  |    |     |  |  | 28  |      
|            
|            
|            
|            
|Texas        |       |            | 26 |             |  |            |    |         |  |  |    |     |  |  | 26  |      
|            
|            
|            
|            
|Wisconsin    |       |            | 19 |             |  |            |    |         |  |  |    |     |  |  | 19  |      
|            
|            
|            
|            
|Alaska       |       |            |   |             |  |            | 13  |         |  |  |    |     |  |  | 13  |      
|            
|            
|            
|            
|Montana      |       |            | 11 |             |  |            |    |         |  |  |    |     |  |  | 11  |      
|            
|            
|            
|            
|Wyoming      |       |            | 10 |             |  |            |    |         |  |  |    |     |  |  | 10  |      
|            
|            
|            
|            
|North Dakota |       |            | 7  |             |  |            |    |         |  |  |    |     |  |  | 7   |      
|            
|            
|            
|            
|Hawaii       |       |            | 4  |             |  |            |    |         |  |  |    |     |  |  | 4   |      
|            
|            
|            
|            
|South Dakota |       |            | 3  |             |  |            |    |         |  |  |    |     |  |  | 3   |      
|             |       |            |    |             |  |            |     |         |  |  |     |     |  |  |     |      
|             | Total |            |    | 403         |  |            |     | 257     |  |  |     | 460 |  |  |     | 1,120 | 
|             |       |            |    |             |  |            |     |         |  |  |     |     |  |  |     |      

Our stores are generally open seven days a week, with hours from
8:00 a.m. to 9:00 p.m. (9:00 a.m. to
6:00 p.m. on Sundays). The average store employs
approximately 10 to 20 employees, including a store manager,
 two assistant store managers and a staff of full-time and
part-time employees.

Store Formats

Our stores are generally located in high visibility, high traffic
 strip shopping centers or in freestanding units adjacent to
strip shopping centers. The stores, which range in size from
2,600 to 24,000 square feet, average approximately 7,200 square
feet in size and offer between 13,000 and 17,000 SKUs.

We have three prototype store designs which are 6,000, 7,000 and
8,000 square feet in size. The store size for a given new
location is selected based upon sales volume expectations
determined through demographics and the detailed market analysis
that we prepare as part of our site selection process. The
following table categorizes our stores by size, as of
January 30, 2000:

|                          |  |                  |       | 
|------------------------- |  | ---------------- | ----- | 
|Store Size                |  | Number of Stores
|                          |  |                 
|10,000 sq. ft. or greater |  |                  | 107   | 
|                         
|                         
|                         
|                         
|8,000-9,999 sq. ft        |  |                  | 208   | 
|                         
|                         
|                         
|                         
|6,000-7,999 sq. ft        |  |                  | 485   | 
|                         
|                         
|                         
|                         
|5,000-5,999 sq. ft        |  |                  | 214   | 
|                         
|                         
|                         
|                         
|Less than 5,000 sq. ft    |  |                  | 106   | 
|                          |  |                  |       | 
|                          |  |                  | 1,120 | 
|                          |  |                  |       | 

Approximately 61% of our stores are freestanding, with the
balance principally located within strip shopping centers.
Approximately 85% to 90% of each stores square footage is
selling space, of which approximately 40% to 50% is dedicated to
automotive replacement parts inventory. The replacement parts
inventory area is fronted by a counter staffed by knowledgeable
parts personnel and is equipped with the electronic parts
catalog. The remaining selling space contains gondolas for
accessories and maintenance items,

8



---





Store Growth Strategy

Our store growth strategy is focused on our existing or
contiguous markets and includes:



| |   |                                                                     
| | - | --------------------------------------------------------------------
| |  | Acquiring existing stores;                                          
|
| |  | Opening new stores;                                                 
|
| |  | Relocating smaller stores to larger stores at better locations;
	and
|
| |  | Expanding selected stores.                                          

We have identified most of our stores smaller than 5,000 square
feet as future relocation or expansion priorities.

Our market strategy group, which is a part of our real estate
department, utilizes a sophisticated, market-based approach that
identifies and analyzes potential store locations based on
detailed demographic and competitive studies. These demographic
and competitive studies include analysis of population density,
growth patterns, age, per capita income, vehicle traffic counts
and the number and type of existing automotive-related
facilities, such as automotive parts stores and other competitors
 within a pre-determined radius of the potential new location.
These potential locations are compared to our existing locations
to determine opportunities for opening new stores and relocating
or expanding existing stores.

We believe that the large number of small operators in our
industry has enabled us to effectively pursue an opportunistic
acquisition strategy. We focus our acquisition efforts in
(1) existing markets to achieve further market penetration
in a timely and cost-effective manner without adding additional
retail square footage; and (2) contiguous markets to permit
further leveraging of our established infrastructure over an
increasing sales base.

The following table sets forth our store development activities
during the periods indicated:

|                                           |  |             |       |      |  |      |     |   |  |  |     |  
|------------------------------------------ |  | ----------- | ----- | ---- |  | ---- | --- | - |  |  | --- | -
|                                           |  |            
|                                           |  | Fiscal Year
|                                           |  |            
|                                           |  | 1999        |       | 1998 |  | 1997
|                                           |  |             |       |      |  |     
|Beginning stores                           |  |             | 807   |      |  |      | 718 |   |  |  | 580 |  
|                                          
|                                          
|                                          
|                                          
|New stores                                 |  |             | 84    |      |  |      | 94  |   |  |  | 65  |  
|                                          
|                                          
|                                          
|                                          
|Relocated stores                           |  |             | 26    |      |  |      | 31  |   |  |  | 36  |  
|                                          
|                                          
|                                          
|                                          
|Acquired stores                            |  |             | 280   |      |  |      | 2   |   |  |  | 82  |  
|                                          
|                                          
|                                          
|                                          
|Closed stores (including relocated stores) |  |             | (77   | )    |  |      | (38 | ) |  |  | (45 | )
|                                           |  |             |       |      |  |      |     |   |  |  |     |  
|Ending stores                              |  |             | 1,120 |      |  |      | 807 |   |  |  | 718 |  
|                                           |  |             |       |      |  |      |     |   |  |  |     |  
|Expanded stores                            |  |             | 9     |      |  |      | 5   |   |  |  | 3   |  
|                                          
|                                          
|                                          
|                                          
|Total new, relocated and expanded stores   |  |             | 119   |      |  |      | 130 |   |  |  | 104 |  

We believe that substantial growth opportunities exist in our
current markets and that our store growth strategy will increase
our name recognition and market penetration while we benefit from
 economies of scale in advertising, management and distribution
costs. We opened, relocated, or expanded 119 stores in fiscal
1999 as compared to 130 stores in fiscal 1998. We plan to
continue our store growth strategy and expect to open, acquire,
relocate or expand approximately 100 stores in fiscal 2000. As of
 January 30, 2000, we had executed purchase contracts or
leases for 33 sites, were in various stages of negotiation for 41
 additional sites and had identified numerous potential
additional sites for store growth. New stores generally become
profitable during the first year of operation.

Commercial Sales Program

In addition to our primary focus on serving the do-it-yourself
consumer, we have significantly increased our marketing efforts
to the commercial customer in the automotive replacement parts
market. The

9



---





We have made a significant commitment to this portion of our
business and upgraded the information systems capabilities
available to the commercial sales group. In addition, we employ
one district sales manager for approximately every five stores
that have a commercial sales center. A district sales manager is
responsible for servicing existing commercial accounts and
developing new commercial accounts. In addition, at a minimum
each commercial sales center has a dedicated in-store
salesperson, driver and delivery vehicle.

We believe we are well positioned to effectively and profitably
service commercial customers, who typically require a higher
level of customer service and broad product availability. The
commercial market has traditionally been serviced primarily by
jobbers. Recently, however, automotive specialty retailing
chains, such as our company, have entered the commercial market.
The chains typically have multiple locations in given market
areas and maintain a broad inventory selection. We believe we
have significant competitive advantages in servicing the
commercial market because of our experienced sales associates,
conveniently located stores, attractive pricing and ability to
consistently deliver a broad product offering with an emphasis on
 national brand names.

As of January 30, 2000, we operated commercial service
centers in 554 of our stores. Our sales to commercial accounts
(including sales by stores without commercial service centers)
increased 40% to $217.7 million in fiscal 1999 from $155.8
million in fiscal 1998.

Purchasing

Merchandise is selected from over 300 suppliers and purchased for
 all stores by personnel at our corporate headquarters in
Phoenix, Arizona. No one class of product and no single supplier
accounted for as much as 10% of our purchases in fiscal 1999.

Our inventory management systems include the E-3 Trim Buying
System, which provides inventory movement forecasting based upon
history, trend and seasonality. Combined with service level
goals, vendor lead times and cost of inventory assumptions, the
E-3 Trim Buying System determines the timing and size of purchase
 orders. Approximately 90% of the dollar value of transactions
are sent via electronic data interchange, with the remainder
being sent by a computer facsimile interface. Our store
replenishment system generates orders based upon store on-hand
and store model stock. This includes an automatic model stock
adjustment system utilizing historical sales, seasonality and
store presentation requirements. We also can allocate seasonal
and promotional merchandise based upon a stores history of
prior promotional and seasonal sales.

Our stores offer products with nationally recognized,
well-advertised brand names, such as Armor All, Autolite, AC
Delco, Castrol, Dayco, Exide, Fel Pro, Fram, Havoline, Mobil,
Monroe, Pennzoil, Prestone, Quaker State, RayBestos, Stant,
Sylvania, Turtle Wax and Valvoline. In addition to brand name
products, our stores carry a wide variety of high quality private
 label products. Because most of such products are produced by
nationally recognized manufacturers that produce similar brand
name products that enjoy a high degree of consumer acceptance, we
 believe that our private label products are of a quality that is
 comparable to such brand name products.

We have increased our gross profit margin over the last several
years primarily as a result of obtaining lower product
acquisition costs, more favorable vendor terms, cash discounts
from vendors, efficiencies from our warehouse and distribution
system and improvements in product mix. We believe that the
improved vendor terms are primarily the result of our improved
financial performance and growth in our store count and purchase
volume. Our gross profit margin increased from 44.6% of net sales
 in fiscal 1997 to 48.3% of net sales in fiscal 1999.

10



---



Warehouse and Distribution

Our warehouse and distribution system utilizes bar coding, radio
frequency scanners and sophisticated conveyor and put-to-light
systems. We instituted engineered labor standards and incentive
programs in each of our distribution centers which have
contributed to improved labor productivity. Each store is
currently serviced by one of our three main distribution centers,
 with the regional distribution centers handling bulk materials,
such as oil. All of our merchandise is shipped by vendors to our
distribution centers, with the exception of batteries, which are
shipped directly to stores by the vendor. We have sufficient
warehouse and distribution capacity to meet the requirements of
our growth plans for the foreseeable future.

The following table sets forth certain information relating to
our three main distribution centers as of January 30, 2000:

|                    |  |                                                                                  |  |           |         |           |  |           |       |  |  |  |     | 
|------------------- |  | -------------------------------------------------------------------------------- |  | --------- | ------- | --------- |  | --------- | ----- |  |  |  | --- | 
|                    |  |                                                                                  |  |           |         | Number    |  | Number of
|Distribution        |  |                                                                                  |  | Size      |         | of Stores |  | Full-Time
|Center              |  | Area Served                                                                      |  | (Sq. Ft.) |         | Served    |  | Employees
|                    |  |                                                                                  |  |           |         |           |  |          
|Phoenix, AZ         |  | Arizona, Colorado, Idaho, Nevada, New Mexico, California, Texas,
	Utah           |  |           | 273,520 |           |  |           | 499   |  |  |  | 386 | 
|Dixon, CA           |  | California, Nevada, Washington, Oregon, Idaho, Montana, Wyoming,
	Alaska, Hawaii |  |           | 325,500 |           |  |           | 535   |  |  |  | 418 | 
|Mendota Heights, MN |  | Minnesota, North Dakota, South Dakota, Wisconsin                                 |  |           | 125,000 |           |  |           | 86    |  |  |  | 75  | 
|                    |  |                                                                                  |  |           |         |           |  |           |       |  |  |  |     | 
|                    |  |                                                                                  |  |           | 724,020 |           |  |           | 1,120 |  |  |  | 879 | 
|                    |  |                                                                                  |  |           |         |           |  |           |       |  |  |  |     | 

We have the ability to expand the Phoenix distribution center by
approximately 80,000 square feet and the Dixon distribution
center by 160,000 square feet should the need arise to do so.

Associates

As of January 30, 2000, we employed approximately 9,890
full-time associates and 4,920 part-time associates.
Approximately 86% of the personnel are employed in store level
operations, 7% in distribution and 7% in our corporate
headquarters, including our call center and priority parts
operation.

We have never experienced any material labor disruption and
believe that our labor relations are good. Except for
approximately 700 associates located at 75 stores in the Northern
 California market, who have been represented by two unions for
many years, none of our personnel are represented by a labor
union.

Competition

We compete principally in the do-it-yourself sector of the
automotive aftermarket which is highly fragmented and generally
very competitive. We compete primarily with national and regional
 retail automotive parts chains (such as AutoZone, Inc. and The
Pep Boys  Manny, Moe and Jack, Inc.), wholesalers or
jobber stores (some of which are associated with national
automotive parts distributors or associations, such as NAPA),
automobile dealers and mass merchandisers that carry automotive
replacement parts, maintenance items and accessories (such as
Wal-Mart Stores, Inc.). We believe that chains of automotive
parts stores like ours, with multiple locations in regional
markets, have competitive advantages in marketing, product
selection, purchasing and distribution, as compared to
independent retailers and jobbers that are not part of a chain or
 associated with other retailers or jobbers. We believe that, as
a result of these advantages, national and regional chains have
been gaining market share in recent years at the expense of
independent retailers and jobbers.

The principal competitive factors that affect our business are
store location, customer service, product selection,
availability, quality and price. While we believe that we compete
 effectively in our various markets, certain competitors are
larger in terms of number of stores and sales volume, have
greater financial and management resources and have been
operating longer in certain geographic areas.

11



---



Trade Names, Service Marks and Trademarks

We own and have registered the service mark
Schucks with the United States Patent and
Trademark Office for use in connection with the automotive parts
retailing business. We have the right to use the tradenames
Checker (in connection with the automotive parts
retailing business) and Kragen. In addition, we own
and have registered numerous trademarks with respect to many of
our private label products. We believe that our various
tradenames, service marks and trademarks are important to our
merchandising strategy, but that our business is not otherwise
dependent on any particular service mark, tradename or trademark.
 There are no infringing uses known by us that materially affect
the use of such marks.

Environmental Matters

We are subject to various federal, state and local laws and
governmental regulations relating to the operation of our
business, including those governing recycling of batteries and
used lubricants, and regarding ownership and operation of real
property. We handle hazardous materials during our operations,
and our customers may also use or bring hazardous materials onto
our properties. In addition, in a small number of recently
acquired store locations we service automobiles and we sublease
to third parties other pre-existing service bays. These service
bays are required to dispose of certain items, including used
batteries, lubricants and oils in accordance with applicable
environmental regulations. We currently provide a recycling
program for batteries and for the collection of used lubricants
at certain of our stores as a service to our customers pursuant
to agreements with third-party vendors. Pursuant to the
agreements, the batteries and used lubricants are collected by
our associates, deposited into vendor-supplied containers/pallets
 and then disposed of by the third-party vendors. Our agreements
with such vendors are designed to limit our potential liability
under applicable environmental regulations for any harm caused by
 the batteries and lubricants to off-site properties or even
on-site when such failure is the fault of the vendor. Many of the
 agreements provide us with indemnification against liability
that we may incur in connection with the disposal of such items.

Under environmental laws, a current or previous owner or operator
 of real property may be liable for the cost of removal or
remediation of hazardous or toxic substances on, under, or in
such property. Such laws often impose joint and several liability
 and may be imposed without regard to whether the owner or
operator knew of, or was responsible for, the release of such
hazardous or toxic substances. We do not believe that compliance
with such laws and regulations has had a material impact on our
operations to date, but there can be no assurance that future
compliance with such laws and regulations will not have a
material adverse effect on us.

Item 2.  Properties

The following table sets forth certain information concerning our
 principal facilities:

|                             |  |                     |  |         |         |           |  |  |        |    
|---------------------------- |  | ------------------- |  | ------- | ------- | --------- |  |  | ------ | ---
|                             |  |                     |  | Square  |         | Nature of
|Primary Use                  |  | Location            |  | Footage |         | Occupancy
|                             |  |                     |  |         |         |          
|Corporate office             |  | Phoenix, AZ         |  |         | 94,000  |           |  |  | Leased | (1)
|                            
|                            
|                            
|                            
|Distribution center          |  | Dixon, CA           |  |         | 325,500 |           |  |  | Leased |    
|                            
|                            
|                            
|                            
|Distribution center          |  | Phoenix, AZ         |  |         | 273,520 |           |  |  | Leased |    
|                            
|                            
|                            
|                            
|Distribution center          |  | Mendota Heights, MN |  |         | 125,000 |           |  |  | Leased |    
|                            
|                            
|                            
|                            
|Regional distribution center |  | Auburn, WA          |  |         | 52,400  |           |  |  | Leased |    
|                            
|                            
|                            
|                            
|Regional distribution center |  | Denver, CO          |  |         | 34,800  |           |  |  | Leased |    
|                            
|                            
|                            
|                            
|Regional distribution center |  | Salt Lake, UT       |  |         | 32,000  |           |  |  | Leased |    
|                            
|                            
|                            
|                            
|Regional distribution center |  | Commerce, CA        |  |         | 48,400  |           |  |  | Leased |    




|    |                                                                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | This facility is owned by Missouri Falls Partners, an affiliate
	of The Carmel Trust (Carmel), a trust governed under
	the laws of Canada. Carmel is an affiliate of the Company and a
	member of the Carmel Group.

12



---



At January 30, 2000, all but four of our stores were leased.
 The expiration dates (including renewal options) of the store
leases are summarized as follows:

|                |  |           |       | 
|--------------- |  | --------- | ----- | 
|                |  | 1999     
|Years           |  | Stores(1)
|                |  |          
|2000-2001       |  |           | 22    | 
|               
|               
|               
|               
|2002-2005       |  |           | 71    | 
|               
|               
|               
|               
|2006-2010       |  |           | 121   | 
|               
|               
|               
|               
|2011-2020       |  |           | 432   | 
|               
|               
|               
|               
|2021-2030       |  |           | 428   | 
|               
|               
|               
|               
|2031-thereafter |  |           | 42    | 
|                |  |           |       | 
|                |  |           | 1,116 | 
|                |  |           |       | 




|    |                                                     
|--- | ----------------------------------------------------
|(1) | Of these stores, 1 is owned by affiliates of Carmel.

Additional information regarding our facilities appears in
Item I. Business under the captions Store
Operations, Store Formats and Warehouse
and Distribution.

Item 3.  Legal Proceedings

On May 4, 1998, a lawsuit was filed against us in the
Superior Court in San Diego, California. The case was brought by
two former store managers and a former senior assistant manager.
It purports to be a class action for all present and former
California store managers and senior assistant managers and seeks
 overtime pay for a period beginning in May 1995 as well as
injunctive relief requiring overtime pay in the future. We have
also been served with two other lawsuits purporting to be class
actions filed in California state courts in Orange and Fresno
Counties by thirteen other former and current employees. These
lawsuits include similar claims to the San Diego lawsuit, except
that they also include claims for unfair business practices which
 seek overtime from October 1994. The Orange County lawsuit
initially included claims for punitive damages and unlawful
conversion, but the Court subsequently dismissed both of these
claims.

The three cases have been coordinated before one
judge in San Diego County. Discovery has been conducted by the
parties. On January 19, 2000, as amended on January 27,
 2000, the judge issued an order allowing the coordinated
lawsuits to proceed as class actions, with class periods of
May 1994 through January 2000 for store managers and
October 1994 through July 1997 for senior assistant
managers. We filed a Petition for Writ of Mandate seeking
appellate review of the foregoing order which was not successful.
 On March 23, 2000, we filed a Petition for Review by the
California Supreme Court to have the trial courts order
reversed.

Although we cannot estimate the potential loss or range of loss
at this time, if these cases are permitted to proceed as class
actions and are decided against us, we believe that the aggregate
 potential exposure could be material to results of operations or
 cash flows for the year in which the cases are ultimately
decided. However, we do not believe that such an adverse outcome,
 if it were to happen, would materially affect our financial
position, operations or cash flows in subsequent periods.
Although at this stage in the litigation it is difficult to
predict its outcome with any certainty, we believe that there are
 meritorious defenses to these cases and intend to defend them
vigorously.

We were served on March 8, 2000 with a complaint filed in
Federal Court in the Eastern District of New York by the
Coalition for a Level Playing Field, L.L.C. and 179 individual
auto parts dealers alleging that we and seven other auto parts
dealers (AutoZone, Inc., Wal-Mart Stores, Inc., Advance Stores
Company, Inc., Discount Auto, Inc., The Pep Boys 
Manny, Moe and Jack, Inc., OReilly Automotive, Inc., and
Keystone Automotive Operations, Inc.) violated the
Robinson-Patman Act. Only 14 of the individual plaintiffs
asserted claims against us, and three of those have voluntarily
dismissed their claims without prejudice. The complaint alleges
that we and other defendants knowingly either induced or received
 discriminatory prices from large suppliers, allegedly in
violation of Section 2(a) and 2(f) of the Robinson-Patman
Act, as well as receiving

13



---





We currently and from time to time are involved in other
litigation incidental to the conduct of our business. The damages
 claimed in some of this litigation are substantial. Although the
 amount of liability that may result from these matters cannot be
 ascertained, we do not currently believe that, in the aggregate,
 they will result in liabilities material to our consolidated
financial condition, results of operations or cash flows.

Item 4.  Submission of Matters to a Vote of
Security Holders

No matters were submitted to a vote of our stockholders during
the fourth quarter of fiscal 1999.

PART II

Item 5.  Market for Registrants Common
 Stock and Related Stockholder Matters

Our common stock has been listed on the New York Stock Exchange
under the symbol CAO since March 12, 1998. As of
April 18, 2000, there were 27,837,558 shares of our common
stock outstanding. As of April 18, 2000, there were
approximately 78 record holders of our common stock.

The following table sets forth, for the periods indicated, the
high and low bid prices for our common stock as reported by the
New York Stock Exchange.

|             |                                     |                |   |       |  |  |   |       | 
|------------ | ----------------------------------- | -------------- | - | ----- |  |  | - | ----- | 
|             |                                     |               
|             |                                     | Price Range of
|             |                                     | Common Stock  
|             |                                     |               
|             |                                     | High           |   | Low  
|             |                                     |                |   |      
|Fiscal 1999: |                                     |                |   |       |  |  |   |      
|            
|            
|            
|            
|             | First Quarter                       |                | $ | 37.38 |  |  | $ | 23.63 | 
|            
|            
|            
|            
|             | Second Quarter                      |                |   | 30.63 |  |  |   | 24.00 | 
|            
|            
|            
|            
|             | Third Quarter                       |                |   | 25.56 |  |  |   | 17.13 | 
|            
|            
|            
|            
|             | Fourth Quarter                      |                |   | 21.25 |  |  |   | 11.06 | 
|            
|            
|            
|            
|Fiscal 1998: |                                     |                |   |       |  |  |   |      
|            
|            
|            
|            
|             | First Quarter (from March 12, 1998) |                | $ | 27.81 |  |  | $ | 22.00 | 
|            
|            
|            
|            
|             | Second Quarter                      |                |   | 28.50 |  |  |   | 23.13 | 
|            
|            
|            
|            
|             | Third Quarter                       |                |   | 27.50 |  |  |   | 19.44 | 
|            
|            
|            
|            
|             | Fourth Quarter                      |                |   | 34.63 |  |  |   | 21.75 | 

We have not paid any dividends on our common stock during the
last two fiscal years. We currently do not intend to pay any
dividends on our common stock.

We are a holding company with no business operations of our own.
We therefore depend upon payments, dividends and distributions
from CSK Auto, Inc., our wholly owned subsidiary, for funds to
pay dividends to our stockholders. CSK Auto, Inc. currently
intends to retain its earnings to fund its working capital, debt
repayment and capital expenditure needs and for other general
corporate purposes. CSK Auto, Inc. has no current intention of
paying dividends or making other distributions to us in excess of
 amounts necessary to pay our operating expenses and taxes. CSK
Auto, Inc.s senior credit facility and the indenture
governing its 11% senior subordinated notes contain restrictions
on CSK Auto, Inc.s ability to pay dividends or make
payments or other distributions to us.

14



---



Item 6.  Selected Consolidated Financial
Data

The following table sets forth our selected consolidated
statement of operations, balance sheet and operating data. The
selected statement of operations and balance sheet data are
derived from our consolidated financial statements, which have
been audited by PricewaterhouseCoopers LLP, independent
accountants. You should read the data presented below together
with our consolidated financial statements and related notes, the
 other financial information contained herein, and
Managements Discussion and Analysis of Financial
Condition and Results of Operations.

|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |         | 
|-------------------------------------------------------------------------------------------------------------- | --------------------------------------- | ---------------------------------------------------------------- | --------- | ------- |  | ------- | --------- | ------- |  | ------- | ------- | ------- |  | - | ------- | ------- |  | - | ------- | ------- | 
|                                                                                                               |                                         |                                                                 
|                                                                                                               |                                         | Fiscal Year(1)                                                  
|                                                                                                               |                                         |                                                                 
|                                                                                                               |                                         | 1999(2)                                                          |           | 1998(3) |  | 1997(4) |           | 1996(5) |  | 1995(6)
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |        
|                                                                                                               |                                         |                                                                 
|                                                                                                               |                                         | (in thousands, except per share amounts and selected store data)
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Statement of Operations Data                                                                                   |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Net sales                                                                                                      |                                         | $                                                                | 1,231,455 |         |  | $       | 1,004,385 |         |  | $       | 845,815 |         |  | $ | 793,092 |         |  | $ | 718,352 |        
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Cost of sales                                                                                                  |                                         |                                                                  | 636,239   |         |  |         | 531,073   |         |  |         | 468,171 |         |  |   | 463,374 |         |  |   | 433,817 |        
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Gross profit                                                                                                   |                                         |                                                                  | 595,216   |         |  |         | 473,312   |         |  |         | 377,644 |         |  |   | 329,718 |         |  |   | 284,535 |        
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Other costs and expenses:                                                                                      |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Operating and administrative            |                                                                  |           | 471,340 |  |         |           | 391,528 |  |         |         | 326,198 |  |   |         | 298,004 |  |   |         | 281,387 | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Store closing costs                     |                                                                  |           | 4,900   |  |         |           | 335     |  |         |         | 1,640   |  |   |         | 14,904  |  |   |         | 3,310   | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Transition and integration expenses     |                                                                  |           | 30,187  |  |         |           | 3,075   |  |         |         | 3,407   |  |   |         |        |  |   |         |        | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Goodwill amortization                   |                                                                  |           | 1,941   |  |         |           |        |  |         |         |        |  |   |         |        |  |   |         |        | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Stock-based compensation                |                                                                  |           |        |  |         |           |        |  |         |         | 909     |  |   |         |        |  |   |         |        | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Write-off of unamortized management fee |                                                                  |           |        |  |         |           | 3,643   |  |         |         |        |  |   |         |        |  |   |         |        | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | 1996 Recapitalization charge            |                                                                  |           |        |  |         |           |        |  |         |         |        |  |   |         | 20,174  |  |   |         |        | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Secondary stock offering costs          |                                                                  |           |        |  |         |           | 770     |  |         |         |        |  |   |         |        |  |   |         |        | 
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Operating profit (loss)                                                                                        |                                         |                                                                  | 86,848    |         |  |         | 73,961    |         |  |         | 45,490  |         |  |   | (3,364  | )       |  |   | (162    | )      
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Other 1996 Recapitalization charges                                                                            |                                         |                                                                  |          |         |  |         |          |         |  |         | 1,009   |         |  |   | 12,463  |         |  |   |        |        
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Interest expense, net                                                                                          |                                         |                                                                  | 41,300    |         |  |         | 30,730    |         |  |         | 40,680  |         |  |   | 20,691  |         |  |   | 14,379  |        
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Income (loss) before income taxes, extraordinary loss and
	cumulative effect of change in accounting principle |                                         |                                                                  | 45,548    |         |  |         | 43,231    |         |  |         | 3,801   |         |  |   | (36,518 | )       |  |   | (14,541 | )      
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Income tax expense(benefit)                                                                                    |                                         |                                                                  | 17,436    |         |  |         | 15,746    |         |  |         | 1,557   |         |  |   | (11,859 | )       |  |   | (5,447  | )      
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Income (loss) before extraordinary loss and cumulative effect of
	change in accounting principle               |                                         |                                                                  | 28,112    |         |  |         | 27,485    |         |  |         | 2,244   |         |  |   | (24,659 | )       |  |   | (9,094  | )      
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Extraordinary loss, net of income taxes                                                                        |                                         |                                                                  |          |         |  |         | (6,767    | )       |  |         | (3,015  | )       |  |   |        |         |  |   |        |        
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Income(loss) before cumulative effect of change in accounting
	principle                                       |                                         |                                                                  | 28,112    |         |  |         | 20,718    |         |  |         | (771    | )       |  |   | (24,659 | )       |  |   | (9,094  | )      
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Cumulative effect of change in accounting principle, net of
	income taxes                                      |                                         |                                                                  | (741      | )       |  |         |          |         |  |         |        |         |  |   |        |         |  |   |        |        
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Net income (loss)                                                                                              |                                         | $                                                                | 27,371    |         |  | $       | 20,718    |         |  | $       | (771    | )       |  | $ | (24,659 | )       |  | $ | (9,094  | )      
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Diluted earnings (loss) per share                                                                              |                                         | $                                                                | 0.96      |         |  | $       | 0.75      |         |  | $       | (0.04   | )       |  | $ | (2.28   | )       |  | $ | (1.04   | )      
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        
|Shares used for computation                                                                                    |                                         |                                                                  | 28,627    |         |  |         | 27,640    |         |  |         | 18,012  |         |  |   | 10,819  |         |  |   | 8,724   |        
|                                                                                                               |                                         |                                                                  |           |         |  |         |           |         |  |         |         |         |  |   |         |         |  |   |         |        

15



---



|                                                     |  |                                                                  |           |         |  |         |         |         |  |         |         |   |  |   |          |   |  |   |         |  
|---------------------------------------------------- |  | ---------------------------------------------------------------- | --------- | ------- |  | ------- | ------- | ------- |  | ------- | ------- | - |  | - | -------- | - |  | - | ------- | -
|                                                     |  |                                                                 
|                                                     |  | Fiscal Year(1)                                                  
|                                                     |  |                                                                 
|                                                     |  | 1999(2)                                                          |           | 1998(3) |  | 1997(4) |         | 1996(5) |  | 1995(6)
|                                                     |  |                                                                  |           |         |  |         |         |         |  |        
|                                                     |  |                                                                 
|                                                     |  | (in thousands, except per share amounts and selected store data)
|                                                    
|                                                    
|                                                    
|                                                    
|Other Data                                           |  |                                                                  |           |         |  |         |         |         |  |         |         |   |  |   |          |   |  |   |         |  
|                                                    
|                                                    
|                                                    
|                                                    
|EBITDA(7)                                            |  | $                                                                | 148,966   |         |  | $       | 103,861 |         |  | $       | 70,173  |   |  | $ | 50,544   |   |  | $ | 16,099  |  
|                                                    
|                                                    
|                                                    
|                                                    
|EBITDAR(7)                                           |  |                                                                  | 242,295   |         |  |         | 175,549 |         |  |         | 124,695 |   |  |   | 98,450   |   |  |   | 61,453  |  
|                                                    
|                                                    
|                                                    
|                                                    
|Capital expenditures                                 |  |                                                                  | 41,358    |         |  |         | 37,846  |         |  |         | 20,132  |   |  |   | 6,317    |   |  |   | 11,640  |  
|                                                    
|                                                    
|                                                    
|                                                    
|Commercial sales(8)                                  |  |                                                                  | 217,696   |         |  |         | 155,845 |         |  |         | 115,378 |   |  |   | 89,551   |   |  |   | 60,840  |  
|                                                    
|                                                    
|                                                    
|                                                    
|Net cash provided by (used in) operating activities  |  |                                                                  | (4,031    | )       |  |         | 3,403   |         |  |         | (62,703 | ) |  |   | (33,836  | ) |  |   | 1,354   |  
|                                                    
|                                                    
|                                                    
|                                                    
|Net cash used in investing activities                |  |                                                                  | (260,221  | )       |  |         | (37,524 | )       |  |         | (56,727 | ) |  |   | (15,216  | ) |  |   | (7,888  | )
|                                                    
|                                                    
|                                                    
|                                                    
|Net cash provided by financing activities            |  |                                                                  | 268,524   |         |  |         | 36,759  |         |  |         | 119,059 |   |  |   | 49,911   |   |  |   | 8,028   |  
|                                                    
|                                                    
|                                                    
|                                                    
|Selected Store Data                                  |  |                                                                  |           |         |  |         |         |         |  |         |         |   |  |   |          |   |  |   |         |  
|                                                    
|                                                    
|                                                    
|                                                    
|Number of stores(end of period)                      |  |                                                                  | 1,120     |         |  |         | 807     |         |  |         | 718     |   |  |   | 580      |   |  |   | 566     |  
|                                                    
|                                                    
|                                                    
|                                                    
|Percentage increase in comparable store net sales(9) |  |                                                                  | 4         | %       |  |         | 2       | %       |  |         | 4       | % |  |   | 6        | % |  |   | 2       | %
|                                                    
|                                                    
|                                                    
|                                                    
|Balance Sheet Data (end of period)                   |  |                                                                  |           |         |  |         |         |         |  |         |         |   |  |   |          |   |  |   |         |  
|                                                    
|                                                    
|                                                    
|                                                    
|Net working capital                                  |  | $                                                                | 456,594   |         |  | $       | 306,879 |         |  | $       | 235,651 |   |  | $ | 121,157  |   |  | $ | 81,048  |  
|                                                    
|                                                    
|                                                    
|                                                    
|Total assets                                         |  |                                                                  | 1,035,652 |         |  |         | 634,022 |         |  |         | 563,251 |   |  |   | 443,986  |   |  |   | 391,319 |  
|                                                    
|                                                    
|                                                    
|                                                    
|Total debt(including current maturities)             |  |                                                                  | 627,133   |         |  |         | 333,293 |         |  |         | 439,962 |   |  |   | 335,680  |   |  |   | 122,003 |  
|                                                    
|                                                    
|                                                    
|                                                    
|Stockholders equity(deficit)                        |  |                                                                  | 134,547   |         |  |         | 105,389 |         |  |         | (75,055 | ) |  |   | (102,263 | ) |  |   | 59,997  |  

See accompanying notes on pages 17 and 18.

16



---



Notes to Selected Consolidated Financial Data



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Our fiscal year consists of 52 or 53 weeks, ends on the
	Sunday nearest to January 31 and is named for the calendar
	year just ended. All fiscal years presented had 52 weeks
	except for fiscal 1996, which had 53 weeks.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|(2) | During 1999, we acquired 194 AGA stores and 86 Big Wheel stores.
	See Note 3 to the Consolidated Financial Statements. These
	stores have been included in results of operations from the date
	of the respective acquisitions. Results of operations in fiscal
	1999 include: (1) $30.2 million of transition and
	integration expenses associated with the Big Wheel and AGA
	Acquisitions; (2) $2.5 million of store closing costs for
	CSK Auto stores that were identified for closure due to overlap
	with certain acquired stores; (3) a charge of $0.7 million,
	net of income tax, relating to the cumulative effect of a change
	in accounting principle associated with the adoption of Statement
	 of Position (SOP) 98-5 (see Note 2 to the
	Consolidated Financial Statements). Excluding these non-recurring
	 items, net of related income tax benefit thereon, net income for
	 the fiscal year was $48.3 million or $1.69 per diluted share
	(based on 28.6 million shares outstanding).
|   
|(3) | Results of operations in fiscal 1998 include: (1) an
	extraordinary loss of $6.8 million, which consisted primarily of
	the premiums paid in connection with the retirement of
	outstanding debt with the proceeds of our initial public offering
	 and the write-off of a portion of deferred debt issuance costs;
	(2) $3.1 million of transition and integration expenses
	associated with the Trak West Acquisition; (3) the write-off
	 of a $3.6 million prepaid management fee; and (4) $0.8
	million of secondary offering costs. Excluding these
	non-recurring items, net of related income tax benefit thereon,
	net income for the fiscal year was $32.2 million or $1.13 per
	diluted share (based on 28.6 million shares outstanding).                                                                                                                                                                                                                                                        
|   
|(4) | In December 1997, we acquired 82 Trak West stores which have
	 been included in results of operations from the date of
	acquisition. Results of operations in fiscal 1997 include:
	(1) an extraordinary loss of $3.0 million to reflect the
	write-off of certain deferred financing costs associated with the
	 early extinguishment of our previous senior credit facility;
	(2)  $3.4 million of transition and integration expenses
	associated with the Trak West Acquisition; and (3) $1.0
	million of other expenses related to our recapitalization in
	October 1996.                                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|(5) | Results of operations in fiscal 1996 include certain
	non-recurring charges which were incurred when we consummated our
	 recapitalization in October 1996, including the following:
	(1) amounts paid to members of management pursuant to then
	existing equity participation agreements of $19.9 million ($20.2
	million including a provision for estimated payroll taxes
	thereon); and (2) expenses of $12.5 million incurred in
	connection with our 1996 recapitalization. Our fiscal 1996
	results also include a charge of $12.9 million to reflect the
	store closing costs of 91 specific store sites. This charge is
	included in store closing costs.                                                                                                                                                                                                                                                                                                                                         
|   
|(6) | Results of operations in fiscal 1995 include pre-opening expenses
	 of $1.6 million associated with the opening of our new
	distribution center in Phoenix, Arizona. Our fiscal 1995
	operating and administrative expenses also include $5.3 million
	of software development costs associated with the new store-level
	 information systems we installed during fiscal 1995. In
	addition, we believe that our operations and operating results
	were adversely impacted during fiscal 1995 as a result of the
	start-up costs associated with the implementation of many new
	initiatives.                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|(7) | EBITDA represents income before net interest expense, provision
	for income taxes, depreciation and amortization expense, other
	non-cash charges, extraordinary items and non-recurring charges.
	While EBITDA is not intended to represent cash flow from
	operations as defined by GAAP (and should not be considered as an
	 indicator of operating performance or an alternative to cash
	flow (as measured by GAAP)), it is included herein because we
	believe it is a meaningful measure which provides additional
	information with respect to our ability to meet our future debt
	service, capital expenditure and working capital requirements.
	EBITDA has been calculated as described above in accordance with
	the terms of the indenture under which our 11% Senior
	Subordinated Notes were issued and may differ in method of
	calculation from similarly titled measures used by other
	companies.                                                                                      

17



---



The computation of EBITDA for each of the respective periods
shown is as follows:

|                                                                                                               |                                              |                |         |        |  |      |         |        |  |      |        |        |  |   |         |        |  |   |         |        | 
|-------------------------------------------------------------------------------------------------------------- | -------------------------------------------- | -------------- | ------- | ------ |  | ---- | ------- | ------ |  | ---- | ------ | ------ |  | - | ------- | ------ |  | - | ------- | ------ | 
|                                                                                                               |                                              |               
|                                                                                                               |                                              | Fiscal Year   
|                                                                                                               |                                              |               
|                                                                                                               |                                              | 1999           |         | 1998   |  | 1997 |         | 1996   |  | 1995
|                                                                                                               |                                              |                |         |        |  |      |         |        |  |     
|                                                                                                               |                                              |               
|                                                                                                               |                                              | (in thousands)
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Income (loss) before income taxes, extraordinary loss and
	cumulative effect of change in accounting principle |                                              | $              | 45,548  |        |  | $    | 43,231  |        |  | $    | 3,801  |        |  | $ | (36,518 | )      |  | $ | (14,541 | )     
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Add back:                                                                                                      |                                              |                |         |        |  |      |         |        |  |      |        |        |  |   |         |        |  |   |         |       
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Interest expense, net                        |                |         | 41,300 |  |      |         | 30,730 |  |      |        | 40,680 |  |   |         | 20,691 |  |   |         | 14,379 | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Depreciation and amortization expense        |                |         | 29,375 |  |      |         | 22,412 |  |      |        | 20,367 |  |   |         | 19,225 |  |   |         | 16,261 | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Non-recurring 1996 Recapitalization expenses |                |         |       |  |      |         |       |  |      |        | 1,009  |  |   |         | 32,637 |  |   |         |       | 
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                               | Other non-recurring and non-cash charges     |                |         | 32,743 |  |      |         | 7,488  |  |      |        | 4,316  |  |   |         | 14,509 |  |   |         |       | 
|                                                                                                               |                                              |                |         |        |  |      |         |        |  |      |        |        |  |   |         |        |  |   |         |       
|Total                                                                                                          |                                              | $              | 148,966 |        |  | $    | 103,861 |        |  | $    | 70,173 |        |  | $ | 50,544  |        |  | $ | 16,099  |       
|                                                                                                               |                                              |                |         |        |  |      |         |        |  |      |        |        |  |   |         |        |  |   |         |       



| |                                                                                                                                                                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | EBITDAR represents EBITDA plus operating lease rental expense.
	Because the proportion of stores leased versus owned varies among
	 industry competitors, we believe that EBITDAR permits a
	meaningful comparison of operating performance among industry
	competitors. We lease substantially all of our stores.



|    |                                                                                                                                                                                                                                                                                                                                                                 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(8) | Represents sales to commercial accounts, including sales from
	stores without commercial sales centers.                                                                                                                                                                                                                                                         
|   
|(9) | Comparable store net sales data is calculated based on the change
	 in net sales commencing after the time a new store has been open
	 twelve months. Therefore, sales for the first twelve months a
	new store is open are not included in the comparable store
	calculation. Relocations are included in comparable store net
	sales from the date of opening.



|        |                                                                                       
|------- | --------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
	Condition and Results of Operations

Our fiscal year ends on the Sunday nearest to January 31 and
 is named for the calendar year just ended. Occasionally this
results in a fiscal year which is 53 weeks long. When we
refer to a particular fiscal year, we mean the following:



| |   |                                                            
| | - | -----------------------------------------------------------
| |  | Fiscal 1999 means the 52 weeks ended January 30, 2000;     
|
| |  | Fiscal 1998 means the 52 weeks ended January 31, 1999;
	and
|
| |  | Fiscal 1997 means the 52 weeks ended February 1, 1998.     

General

CSK Auto Corporation is the largest retailer of automotive parts
and accessories in the Western United States and one of the
largest retailers of these products in the United States based,
in each case, on our number of stores. As of January 30,
2000, we operated 1,120 stores as one fully integrated company
under three brand names:



| |   |                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------
| |  | Checker Auto Parts, founded in 1969 and operating in the
	Southwestern, Rocky Mountain and Northern Plains states;
|
| |  | Schucks Auto Supply, founded in 1917 and operating in the
	Pacific Northwest; and                                
|
| |  | Kragen Auto Parts, founded in 1947 and operating primarily in
	California.                                        

18



---



Over the past several years, we have implemented a variety of
initiatives which have enabled us to significantly increase our
productivity and the level and quality of service we provide to
customers. These initiatives include:



| |   |                                                                                                          
| | - | ---------------------------------------------------------------------------------------------------------
| |  | Expanding our product selection and priority parts operation;                                            
|
| |  | Converting our warehouse and distribution system to a
	technologically advanced, fully-integrated system;
|
| |  | Installing sophisticated store-level information systems;                                                
|
| |  | Accelerating our store growth strategy; and                                                              
|
| |  | Expanding our commercial sales program.                                                                  

Largely as a result of the success of these programs, our
profitability has improved. We believe that these initiatives
have provided the foundation for continued and profitable growth.

The discussion which follows includes several references to
charges and effects relating to the following significant
transactions which occurred during the period covered:



| |   |                                                                                                                                                                                                                                                                                                 
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | In October 1999, we acquired 194 Als and Grand Auto
	Supply stores (the AGA stores) located in California
	and the Pacific Northwest from PACCAR, Inc. We refer to this
	transaction as the AGA Acquisition.                                                                               
|
| |  | In September 1999, we acquired Automotive Information
	Systems, Inc. (AIS), a leading provider of diagnostic
	 vehicle repair information. We refer to this transaction as the
	AIS Acquisition.                                                                                            
|
| |  | In June 1999, we acquired 86 Big Wheel/ Rossi stores (the
	Big Wheel stores) located in the Northern Plains
	states from Apsco Products Company. We refer to this transaction
	as the Big Wheel Acquisition.                                                                                
|
| |  | In December 1998, certain of our stockholders completed a
	secondary offering of our common stock. We received no proceeds
	from this offering and incurred an aggregate of $770,000 in
	legal, accounting, printing and other costs. We refer to this
	transaction as the Secondary Offering.
|
| |  | In March 1998, we completed the initial public offering of
	our common stock and used the net proceeds to repay outstanding
	debt. We refer to this transaction as our IPO.                                                                                                                   
|
| |  | In December 1997, we acquired 82 stores located in the Los
	Angeles market from Trak Auto Corporation (the Trak West
	stores). We refer to this transaction as the Trak
	West Acquisition.                                                                                                  

19



---



Results of Operations

The following table sets forth our statement of operations data
expressed as a percentage of net sales for the periods indicated:

|                                                                                          |  |             |       |      |  |      |       |   |  |  |       |   
|----------------------------------------------------------------------------------------- |  | ----------- | ----- | ---- |  | ---- | ----- | - |  |  | ----- | --
|                                                                                          |  |            
|                                                                                          |  | Fiscal Year
|                                                                                          |  |            
|                                                                                          |  | 1999        |       | 1998 |  | 1997
|                                                                                          |  |             |       |      |  |     
|Net sales                                                                                 |  |             | 100.0 | %    |  |      | 100.0 | % |  |  | 100.0 | % 
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Cost of sales                                                                             |  |             | 51.7  |      |  |      | 52.9  |   |  |  | 55.4  |   
|                                                                                          |  |             |       |      |  |      |       |   |  |  |       |   
|Gross profit                                                                              |  |             | 48.3  |      |  |      | 47.1  |   |  |  | 44.6  |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Operating and administrative expenses                                                     |  |             | 38.3  |      |  |      | 39.0  |   |  |  | 38.6  |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Store closing costs                                                                       |  |             | 0.4   |      |  |      |      |   |  |  | 0.2   |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Transition and integration expenses                                                       |  |             | 2.4   |      |  |      | 0.3   |   |  |  | 0.4   |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Goodwill amortization                                                                     |  |             | 0.1   |      |  |      |      |   |  |  |      |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Stock-based compensation                                                                  |  |             |      |      |  |      |      |   |  |  | 0.1   |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Write-off of unamortized management fee                                                   |  |             |      |      |  |      | 0.3   |   |  |  |      |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Secondary offering costs                                                                  |  |             |      |      |  |      | 0.1   |   |  |  |      |   
|                                                                                          |  |             |       |      |  |      |       |   |  |  |       |   
|Operating profit                                                                          |  |             | 7.1   |      |  |      | 7.4   |   |  |  | 5.3   |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Recapitalization charges                                                                  |  |             |      |      |  |      |      |   |  |  | 0.1   |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Interest expense, net                                                                     |  |             | 3.4   |      |  |      | 3.1   |   |  |  | 4.8   |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Income tax expense                                                                        |  |             | 1.4   |      |  |      | 1.6   |   |  |  | 0.1   |   
|                                                                                          |  |             |       |      |  |      |       |   |  |  |       |   
|Income before extraordinary loss and cumulative effect of change
	in accounting principle |  |             | 2.3   |      |  |      | 2.7   |   |  |  | 0.3   |   
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Extraordinary loss, net of income taxes                                                   |  |             |      |      |  |      | (0.6  | ) |  |  | (0.4  | ) 
|                                                                                          |  |             |       |      |  |      |       |   |  |  |       |   
|Income (loss) before cumulative effect of change in accounting
	principle                 |  |             | 2.3   |      |  |      | 2.1   |   |  |  | (0.1  | ) 
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Cumulative effect of change in accounting principle, net of
	income taxes                 |  |             | 0.1   |      |  |      |      |   |  |  |      |   
|                                                                                          |  |             |       |      |  |      |       |   |  |  |       |   
|Net income (loss)                                                                         |  |             | 2.2   | %    |  |      | 2.1   | % |  |  | (0.1  | )%
|                                                                                          |  |             |       |      |  |      |       |   |  |  |       |   

Gross profit consists primarily of net sales less the cost of
sales and warehouse and distribution expenses. Gross profit as a
percentage of net sales may be affected by variations in our
product mix, price changes in response to competitive factors and
 fluctuations in merchandise costs and vendor programs.

Operating and administrative expenses are comprised of store
payroll, store occupancy, advertising expenses, other store
expenses and general and administrative expenses, including
salaries and related benefits of corporate employees,
administrative office occupancy expenses, data processing,
professional expenses and other related expenses.

Fiscal 1999 Compared to Fiscal 1998

Net sales for fiscal 1999 increased $227.1 million, or 22.6%,
over net sales for fiscal 1998, primarily reflecting an increase
in the number of stores operated and a comparable store sales
increase of 4%. During the third quarter of fiscal 1999, we
acquired 194 Als Auto Supply and Grand Auto Supply stores
from Als and Grand Auto Supply, Inc. formerly known as
PACCAR Automotive, Inc. During the second quarter of fiscal 1999,
 we acquired 86 former Big Wheel stores from Apsco Products
Company. The acquired stores contributed $101.5 million of net
sales during the portion of the year that we owned them. In
addition to the AGA and Big Wheel stores, during fiscal 1999 we
opened 84 new stores, relocated 26 stores and expanded 9 stores.
We closed 77 stores including those closed due to relocation, of
which 37 were acquired stores. At January 30, 2000, we had
1,120 stores in operation compared to 807 stores at the end of
fiscal 1998.

Gross profit for fiscal 1999 was $595.2 million, or 48.3% of net
sales, compared to $473.3 million, or 47.1% of net sales, for
fiscal 1998. The increase in gross profit percentage primarily
resulted from our ability to

20



---





Operating and administrative expenses increased by $79.8 million
to $471.3 million, or 38.3% of net sales, for fiscal 1999 from
$391.5 million, or 39.0% of net sales, for fiscal 1998. The
increase in dollar value is primarily the result of the operating
 costs of new stores. The decrease as a percent of sales resulted
 from a leveraging of fixed costs over an expanded sales base.

Operating profit increased to $86.8 million, or 7.1% of net
sales, for fiscal 1999, compared to $74.0 million, or 7.4% of net
 sales, for fiscal 1998. During fiscal 1999, we incurred $30.2
million of non-recurring expenses associated with the integration
 and conversion of the AGA and Big Wheel stores into our
operations, $2.5 million of store closing costs for CSK Auto
stores that were identified for closure due to overlap with
certain acquired stores, $1.9 million of goodwill amortization
relating to our recent acquisitions and $2.4 million of other
store closing costs. Operating profit for fiscal 1998 was
affected by $3.1 million of expenses associated with the
integration of the Trak West stores, a $3.6 million non-recurring
 charge associated with the termination of a management agreement
 as a result of our IPO and $0.8 million of costs associated with
 our Secondary Offering.

Interest expense for fiscal 1999 increased to $41.3 million from
$30.7 million for fiscal 1998. The expense increased primarily as
 a result of the additional indebtedness incurred to fund the AGA
 and Big Wheel Acquisitions.

Income tax expense for fiscal 1999 was $17.4 million, compared to
 income tax expense of $15.7 million in fiscal 1998. Our
effective tax rate increased during the 1999 period to
approximately 38% of pre-tax income from approximately 36% in
fiscal 1998 as a result of certain tax credits that were realized
 in the prior year which were not available in the current year.

Fiscal 1999 was affected by a charge of $0.7 million, net of
income tax, relating to the cumulative effect of a change in
accounting principle associated with the adoption of
SOP 98-5, Reporting on the Cost of Start-up
Activities. See Note 2 to the Consolidated Financial
Statements.

As a result of the factors cited above, net income increased in
fiscal 1999 to $27.4 million, or $0.96 per diluted share,
compared to net income for fiscal 1998 of $20.7 million, or $0.75
 per diluted share. Additionally, earnings before interest,
taxes, depreciation and amortization (EBITDA)
increased by $45.1 million to $149.0 million in fiscal 1999
compared to $103.9 million in fiscal 1998.

Fiscal 1998 Compared to Fiscal 1997

Net sales for fiscal 1998 increased $158.6 million, or 18.7%,
over net sales for fiscal 1997, primarily reflecting an increase
in the number of stores operated. Our comparable store sales
increased $17.5 million, or 2%. Our new stores contributed $138.9
 million to the increase in net sales for the fiscal year,
including $84.3 million in net sales contributed by the stores
acquired in the Trak West Acquisition. During fiscal 1998, we
opened 94 stores, relocated 31 stores, expanded 5 stores,
acquired 2 stores and closed 7 stores in addition to those closed
 due to relocation. As a result, we operated 807 stores at the
end of fiscal 1998 compared to 718 stores at the end of fiscal
1997.

Gross profit for fiscal 1998 was $473.3 million, or 47.1% of net
sales, compared to $377.6 million, or 44.6% of net sales, for
fiscal 1997. The increase in gross profit percentage primarily
resulted from our ability to obtain generally better pricing and
more favorable terms and support from our vendors due to
increased purchase volume, improved financial performance and
stronger capitalization.

Operating and administrative expenses increased by $65.3 million
to $391.5 million, or 39.0% of net sales, for fiscal 1998 from
$326.2 million, or 38.6% of net sales, for fiscal 1997. The
increase is primarily the result of the operating costs of new
stores that are in the early stages of maturation and the
operating costs of the Trak West stores, which exceed our
company-wide average as a percent of sales.

21



---



Operating profit increased to $74.0 million, or 7.4% of net
sales, for fiscal 1998, compared to $45.5 million, or 5.3% of net
 sales, for fiscal 1997. During the first quarter of 1998, we
incurred $3.1 million of expenses associated with the integration
 of the Trak West stores and a $3.6 million non-recurring charge
associated with the termination of a management agreement as a
result of our IPO. In the fourth quarter of fiscal 1998, we
incurred $0.8 million of costs in connection with the Secondary
Offering. Operating profit for fiscal 1997 was affected by $3.4
million of expenses associated with the integration of the Trak
West stores and by $0.9 million of stock-based compensation
expense.

Interest expense for fiscal 1998 decreased to $30.7 million from
$40.7 million for fiscal 1997. The expense decreased primarily as
 the result of the early retirement of approximately $147.6
million of outstanding debt with the proceeds of our IPO. The
retirement of this debt also produced an extraordinary loss of
$6.8 million, net of tax, which consisted primarily of prepayment
 premiums paid in connection with the redemption of debt and the
write-off of a portion of deferred debt issuance costs.

Income tax expense for fiscal 1998 was $15.7 million compared to
income tax expense of $1.6 million in fiscal 1997.

As a result of the factors cited above, net income increased in
fiscal 1998 to $20.7 million, $0.75 per diluted share, from a net
 loss for fiscal 1997 of $0.8 million, or $0.04 per diluted
share. Additionally, earnings before interest, taxes,
depreciation and amortization (EBITDA) increased by
$33.7 million to $103.9 million in fiscal 1998, compared to $70.2
 million in fiscal 1997.

Liquidity and Capital Resources

Overview

Our primary cash requirements include working capital (primarily
inventory), debt service obligations and capital expenditures. We
 intend to finance our cash requirements with cash flows from
operations, funds from our leasing facility and borrowings under
our revolving credit facility. At January 30, 2000, we had
net working capital of approximately $456.6 million and total
liquidity (cash plus availability under our revolving credit
facility) of approximately $44.9 million. We also have access to
an off-balance sheet operating lease facility that is used to
finance new store construction. The facility provides up to
$112.2 million of funding for the acquisition and development of
up to 94 new stores through December 31, 2000. As of
January 30, 2000, $4.6 million of this $112.2 million
leasing facility had been utilized. Under a similar agreement
that expired on May 31, 1999 with respect to the addition of
 new stores, we had approximately $87.6 million committed, with
$10.5 million remaining to be funded for stores that were
previously identified for development but not completed by
May 31, 1999. We believe that cash flow from operations
combined with the availability of funds under the leasing
facility and the revolving credit facility will be sufficient to
support our operations and liquidity requirements for the
foreseeable future.

In fiscal 1999, net cash used in operating activities was $4.0
million, compared to $3.4 million of cash provided by operating
activities during fiscal 1998. The largest component of the
change in cash flow from operating activities relates to our
investment in inventories, where $93.6 million of cash was used
during fiscal 1999 compared to $45.8 million used for such
purposes during fiscal 1998. The increase in inventories reflects
 the Big Wheel and AGA Acquisitions, the increase in number of
stores operated, and an expanded product selection in support of
our commercial sales program. In addition, net income increased
by $6.7 million, partially offsetting the use of cash for
inventories.

Net cash used in investing activities totaled $260.2 million in
fiscal 1999, compared to $37.5 million in fiscal 1998. The
increase in cash used in investing activities was primarily the
result of $218.2 million used in the Big Wheel, AGA and AIS
Acquisitions.

Net cash provided by financing activities totaled $268.5 million
in fiscal 1999 compared to $36.8 million in fiscal 1998. In 1999,
 we used $283.7 million of net borrowings under the Senior Credit
 Facility primarily relating to the Big Wheel, AGA and AIS
Acquisitions, incurred $4.7 million of debt issuance costs, made
payments of $10.9 million on capital lease obligations, received
$0.4 million of stockholder receivables, received $0.8 million in
 proceeds from stock option exercises and paid $0.7 in connection
 with other financing

22



---





Store Acquisitions

In June 1999, we paid approximately $62.7 million in cash
for substantially all the assets and assumed certain current
liabilities and indebtedness of Big Wheel. The acquisition was
funded with proceeds from our senior credit facility. In
connection with the acquisition, we amended and restated our
senior credit facility to provide an additional $125.0 million of
 senior term loan borrowing ability. We used $64.4 million, which
 included $1.7 million in debt issuance costs, of this facility
in conjunction with the Big Wheel acquisition and the remaining
$60.6 million was used to fund transition costs and to reduce the
 balance of the revolving credit portion of our senior credit
facility.

We have converted the Big Wheel stores to the Checker name and
store format and integrated these stores into our operations. In
connection with the integration of the Big Wheel stores, we will
incur one-time transition and integration expenses estimated to
be $12.5 million, consisting primarily of grand opening
advertising, training and re-merchandising costs. Approximately
$8.9 million of such expenses were incurred during fiscal 1999
with the balance expected to be incurred during the first quarter
 of fiscal 2000. In addition, we will incur one-time capital
expenditures estimated to be $3.2 million, consisting primarily
of expenditures related to equipment, store fixtures, signage and
 the installation of our store-level information systems in the
Big Wheel stores. Approximately $3.0 million of such capital
expenditures were incurred during fiscal 1999 with the balance
expected to be incurred during the first quarter of fiscal 2000.
During the fourth quarter we revised our estimates for transition
 and integration expenses and capital expenditures. Expected
transition and integration expenses increased from our original
estimate of $7.0 million to $12.5 million and expected capital
expenditures decreased from our original estimate of $6.0 million
 to $3.2 million. We have revised our estimates as a result of a
change in our transition plan that allows for: (1) higher
training and re-merchandising costs, resulting from increased
labor hours and store set-up rates, and (2) lower capital
expenditures, resulting from an increased allocation of existing
equipment and greater utilization of operating lease facilities.
As a result of the change in the transition plan, our overall
conversion budget increased by $2.7 million.

In October 1999, we paid approximately $145.6 million in
cash for the common stock of AGA and associated transaction
costs. The acquisition was funded with proceeds from our senior
credit facility. In connection with the acquisition, we amended
and restated our senior credit facility to provide an additional
$150.0 million of senior term loan borrowing ability. We used
$148.6 million, which included $3.0 million in debt issuance
costs, of this facility in conjunction with the AGA Acquisition
and the remaining $1.4 million was used to fund transition costs
and working capital needs.

We have converted the AGA stores that we acquired to the Checker,
 Schucks and Kragen names and store formats and integrated
these stores into our operations. In connection with the
integration of the AGA stores, we will incur one-time transition
and integration expenses estimated to be $28.8 million,
consisting primarily of grand opening advertising, training and
re-merchandising costs. Approximately $21.3 million of such
expenses were incurred during fiscal 1999 with the balance
expected to be incurred during the first quarter of fiscal 2000.
In addition, we will incur one-time capital expenditures
estimated to be $5.6 million, consisting primarily of
expenditures related to equipment, store fixtures, signage and
the installation of our store-level information systems in the
AGA stores. Approximately $2.0 million of such capital
expenditures were incurred during fiscal 1999 with the balance
expected to be incurred during the first quarter of fiscal 2000.
During the fourth quarter we revised our estimates for transition
 and integration expenses and capital

23



---





Expansion

We opened 119 new, relocated or expanded stores in fiscal 1999
and 130 new, relocated or expanded stores in fiscal 1998. We
expect to open, acquire, relocate or expand approximately 100
stores in fiscal 2000. We anticipate that the majority of these
new, relocated or expanded stores will be financed by our lease
facility under arrangements structured as operating leases that
require no net capital expenditures except for fixtures and store
 equipment. For the remainder of our planned new, relocated or
expanded stores, we expect to spend approximately $125,000 per
store for leasehold improvements. In addition to capital
expenditures, each new store will require an estimated investment
 in working capital, principally for inventories, of
approximately $300,000. New stores generally become profitable
during the first full year of operations.

In addition to capital expenditures for new stores, we expect to
spend approximately $6.5 million over the next year for
information systems hardware and software. Our debt service
requirements in 2000 include scheduled principal reductions of
approximately $13.2 million.

Store Closing Costs

We provide an allowance for estimated costs and losses to be
incurred in connection with store closures. For stores to be
closed, such costs are recognized when a store is specifically
identified, costs can be estimated and closure is planned to be
completed within the next twelve months (prior to
January 31, 1999, eighteen months). For stores to be
relocated, such costs are recognized when an agreement for the
new location has been reached with a landlord and site plans meet
 preliminary municipal approvals. The allowance for store closing
 costs is included in accrued expenses in the accompanying
financial statements, and consists primarily of future rents to
be paid over the remaining terms of the master lease agreement
for stores, net of estimated sub-lease recoveries. Future rents
will be incurred through the expiration of the non-cancelable
leases, the longest of which runs through June 2014.

Activity in the provision for store closings and the related
store closing costs for the three fiscal years ended
January 30, 2000, is as follows (in thousands):

|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |        |       | 
|-------------------------------- | ------------------------------- | ------------------------------------- | ------ | ----- | ----- | ---- | ------ | ----- | --- | - | ------ | ------ | ----- | 
|                                 |                                 |                                      
|                                 |                                 | Fiscal Year                          
|                                 |                                 |                                      
|                                 |                                 | 1999                                  |        | 1998  |       | 1997
|                                 |                                 |                                       |        |       |       |     
|Balance, beginning of year       |                                 | $                                     | 2,670  |       |       | $    | 8,379  |       |     | $ | 10,794 |       
|                                
|                                
|                                
|                                
|Store closing costs:             |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                
|                                
|                                
|                                
|                                 | Store closing costs, gross      |                                       |        | 5,252 |       |      |        | 1,925 |     |   |        | 3,103  |      
|                                
|                                
|                                
|                                
|                                 | Adjustments to prior year plans |                                       |        | (387  | )     |      |        | (620  | )   |   |        | (1,431 | )    
|                                
|                                
|                                
|                                
|                                 | Revisions in estimates          |                                       |        | 35    |       |      |        | (970  | )   |   |        | (32    | )    
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                 |                                 | Store closing costs, net              |        |       | 4,900 |      |        |       | 335 |   |        |        | 1,640 | 
|                                
|                                
|                                
|                                
|Purchase accounting adjustments: |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                
|                                
|                                
|                                
|                                 | Trak West                       |                                       |        |      |       |      |        |      |     |   |        | 625    |      
|                                
|                                
|                                
|                                
|                                 | Big Wheel                       |                                       |        | 98    |       |      |        |      |     |   |        |       |      
|                                
|                                
|                                
|                                
|                                 | Als and Grand Auto Supply      |                                       |        | 4,080 |       |      |        |      |     |   |        |       |      
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                 |                                 | Total purchase accounting adjustments |        |       | 4,178 |      |        |       |    |   |        |        | 625   | 
|                                
|                                
|                                
|                                
|Payments                         |                                 |                                       | (6,946 | )     |       |      | (6,044 | )     |     |   | (4,680 | )     
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|Balance, end of year             |                                 | $                                     | 4,802  |       |       | $    | 2,670  |       |     | $ | 8,379  |       
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       

24



---



During the period that they remain open for business, the rent
and other operating expenses for the stores to be closed continue
 to be reflected in our normal operating expenses. As a result of
 the AGA acquisition, we have analyzed our store locations in
California and the Pacific Northwest. We will close or relocate
approximately 39 of the former AGA stores (of which 37 were
closed as of January 30, 2000) based on several factors
including: (1) market saturation; (2) store
profitability; and (3) store size and format. Costs
associated with these closures have been considered in our
preliminary purchase price allocation (see Note 3 to the
Consolidated Financial Statements). In addition, we finalized a
store closure plan for our own stores that overlap with AGA
stores, which resulted in a pretax charge of approximately $2.5
million during the fourth quarter of fiscal 1999. The charge
consists of two components: (1) future rents to be paid over
 the remaining terms of the master lease agreements for the
stores (net of estimated sub-lease recoveries); and
(2) write-down of leasehold improvements and other fixed
assets associated with the stores.

Adjustments to prior plans relate to costs for store closures
that were accrued in prior years but withdrawn from our store
closure plan in the year of adjustment. Such withdrawals are due
to subsequent improvements in the underlying economics of the
stores performance or (in the case of store relocation)
because we were unable to secure a previously identified site
upon acceptable lease terms. We had significant adjustments to
prior year plans in 1997 and 1998 because of changes resulting
from higher than expected improvements in our gross profit
margins in 1997-1998 and changes resulting from the Trak West
Acquisition (see Note 3 to the Consolidated Financial
Statements) and the IPO (see Note 8 to the Consolidated
Financial Statements). Further significant changes to the
strategic plan are not considered likely. All relocations and
store closings are anticipated to be completed within twelve
months of accrual and only after costs can be estimated.

Other cost revisions are comprised of changes in expected future
rental costs for vacant or sub-leased store locations, which are
due largely to early terminations of lease agreements.

As part of the purchase price allocation for the Trak West, Big
Wheel and AGA stores (see Note 3 to the Consolidated
Financial Statements), we recorded an allowance for the costs of
closing or relocating certain stores.

On a store count basis, activity and the remaining number of
stores to be closed are summarized as follows:

|               |  |                               |    |              |  |            |    |               |  |            |     |   |  |  |     |   |  |  |    | 
|-------------- |  | ----------------------------- | -- | ------------ |  | ---------- | -- | ------------- |  | ---------- | --- | - |  |  | --- | - |  |  | -- | 
|               |  |                               |    |             
|               |  | Number of Stores to be Closed |    |             
|               |  |                               |    |             
|Store Count by |  | Beginning                     |    |              |  | Plan       |    |               |  | Balance to
|Fiscal Year    |  | Balance                       |    | Stores Added |  | Amendments |    | Stores Closed |  | be Closed 
|               |  |                               |    |              |  |            |    |               |  |           
|1997           |  |                               | 56 |              |  |            | 36 |               |  |            | (15 | ) |  |  | (29 | ) |  |  | 48 | 
|              
|              
|              
|              
|1998           |  |                               | 48 |              |  |            | 24 |               |  |            | (10 | ) |  |  | (33 | ) |  |  | 29 | 
|              
|              
|              
|              
|1999           |  |                               | 29 |              |  |            | 87 |               |  |            | (11 | ) |  |  | (77 | ) |  |  | 28 | 

At January 30, 2000, there were 28 stores remaining to be
closed under our store closing plans, comprised of the following:

|                |  |              |    |            |  |               |     |            |  |  |     |   |  |  |    | 
|--------------- |  | ------------ | -- | ---------- |  | ------------- | --- | ---------- |  |  | --- | - |  |  | -- | 
|Store Count by  |  | Stores in    |    | Plan       |  |               |     | Balance to
|Year of Accrual |  | Closing Plan |    | Amendments |  | Stores Closed |     | be Closed 
|                |  |              |    |            |  |               |     |           
|1996            |  |              | 91 |            |  |               | (17 | )          |  |  | (73 | ) |  |  | 1  | 
|               
|               
|               
|               
|1997            |  |              | 36 |            |  |               | (13 | )          |  |  | (20 | ) |  |  | 3  | 
|               
|               
|               
|               
|1998            |  |              | 24 |            |  |               | (5  | )          |  |  | (19 | ) |  |  |   | 
|               
|               
|               
|               
|1999            |  |              | 87 |            |  |               | (1  | )          |  |  | (62 | ) |  |  | 24 | 
|                |  |              |    |            |  |               |     |            |  |  |     |   |  |  |    | 
|                |  |              |    |            |  |               |     |            |  |  |     |   |  |  | 28 | 

Year 2000 Conversion

Historically, certain computerized systems have used two digits
rather than four to define the applicable year. Computer
equipment and software and devices with imbedded technology that
are time-sensitive may recognize a date using 00 as
the year 1900 rather than the year 2000. As a result, the
possibility existed on

25



---





During fiscal 1997, we began a comprehensive review of our
systems and applications for Year 2000 compliance. We also
engaged an independent advisor to evaluate and assist us with our
 Year 2000 program. Our efforts have included both
information technology, such as purchased software and
point-of-sale computer systems, and non-information technology
equipment, such as warehouse conveyor systems, in our
evaluations. In addition, we identified our key third-party
business partners and coordinated with them to address potential
Year 2000 issues. These issues include data exchange with us
 as well as their shipping and warehousing processes.

During the fourth quarter of fiscal 1999, we completed our
Year 2000 identification, assessment, remediation and
testing efforts, although we will continue to monitor systems
through the remainder of fiscal 2000. We also finalized
contingency plans, which include: switching vendors, back-up
systems and manual processes, and the potential stockpiling of
certain products. As of January 30, 2000, we have incurred
and expensed approximately $0.9 million related to our
Year 2000 conversion project. We have also capitalized
approximately $6.2 million in connection with the replacement of
certain hardware and software applications. We do not anticipate
incurring any substantial additional costs during fiscal 2000
related to Year 2000 issues.

As a result of our planning and remediation efforts, we have
experienced no significant business disruption in our systems as
a result of the Year 2000 issue. In addition, as of the date
 of this filing, we have not experienced any Year 2000
operational or financial interruptions, either internally or
externally with vendors or service providers, nor are any
expected. Although we believe that we have successfully avoided
any significant business disruption, we will continue to monitor
all critical systems for the appearance of delayed complications
or disruptions. In addition, we will continue to monitor any
problems encountered by vendors, distributors or service
providers throughout fiscal 2000 to ensure that any latent
Year 2000 matters that may arise are promptly addressed.
However, if any problems are encountered during fiscal 2000 and
we do not make the necessary modifications and conversions, or do
 not complete them in a timely manner, it could have a material
adverse effect on our operations.

Quarterly Results and Seasonality

Our business is somewhat seasonal in nature, with the highest
sales occurring in the summer months of June through August
(overlapping our second and third fiscal quarters). Our business
is, in addition, affected by weather conditions. While unusually
severe or inclement weather tends to reduce sales as our
customers tend to defer elective maintenance during such periods,
 extremely hot and cold temperatures tend to enhance sales by
causing auto parts to fail and sales of seasonal products to
increase.

The following table sets forth certain quarterly unaudited
operating data for fiscal 1999 and 1998. The unaudited quarterly
information includes all adjustments which management considers
necessary for a fair presentation of the information shown.

26



---



The data presented below should be read in conjunction with our
consolidated financial statements and related notes and the other
 financial information included herein.

|                                                                          |  |                                          |         |         |  |         |         |         |  |   |         |  |  |   |         |  
|------------------------------------------------------------------------- |  | ---------------------------------------- | ------- | ------- |  | ------- | ------- | ------- |  | - | ------- |  |  | - | ------- | -
|                                                                          |  |                                         
|                                                                          |  | Fiscal 1999                             
|                                                                          |  |                                         
|                                                                          |  | First                                    |         | Second  |  | Third   |         | Fourth 
|                                                                          |  | Quarter                                  |         | Quarter |  | Quarter |         | Quarter
|                                                                          |  |                                          |         |         |  |         |         |        
|                                                                          |  |                                         
|                                                                          |  | (in thousands, except per share amounts)
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Net sales                                                                 |  | $                                        | 269,402 |         |  | $       | 302,322 |         |  | $ | 331,320 |  |  | $ | 328,411 |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Gross profit                                                              |  |                                          | 130,151 |         |  |         | 142,729 |         |  |   | 160,374 |  |  |   | 161,962 |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Transition and integration expenses                                       |  |                                          |        |         |  |         | 619     |         |  |   | 3,551   |  |  |   | 26,017  |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Operating profit(1)                                                       |  |                                          | 23,223  |         |  |         | 28,781  |         |  |   | 30,496  |  |  |   | 4,348   |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Cumulative effect of change in accounting principle, net of
	income taxes |  |                                          | (741    | )       |  |         |        |         |  |   |        |  |  |   |        |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Net income (loss)(2)                                                      |  |                                          | 9,121   |         |  |         | 12,693  |         |  |   | 11,668  |  |  |   | (6,111  | )
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Basic earnings (loss) per share(3)                                        |  |                                          | 0.33    |         |  |         | 0.46    |         |  |   | 0.42    |  |  |   | (0.22   | )
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Diluted earnings (loss) per share(3)                                      |  |                                          | 0.32    |         |  |         | 0.44    |         |  |   | 0.41    |  |  |   | (0.22   | )
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|EBITDA                                                                    |  | $                                        | 29,119  |         |  | $       | 35,836  |         |  | $ | 41,614  |  |  | $ | 42,397  |  

|                                                  |  |                                          |         |         |  |         |         |         |  |   |         |  |  |   |         | 
|------------------------------------------------- |  | ---------------------------------------- | ------- | ------- |  | ------- | ------- | ------- |  | - | ------- |  |  | - | ------- | 
|                                                  |  |                                         
|                                                  |  | Fiscal 1998                             
|                                                  |  |                                         
|                                                  |  | First                                    |         | Second  |  | Third   |         | Fourth 
|                                                  |  | Quarter                                  |         | Quarter |  | Quarter |         | Quarter
|                                                  |  |                                          |         |         |  |         |         |        
|                                                  |  |                                         
|                                                  |  | (in thousands, except per share amounts)
|                                                 
|                                                 
|                                                 
|                                                 
|Net sales                                         |  | $                                        | 238,423 |         |  | $       | 254,701 |         |  | $ | 263,142 |  |  | $ | 248,119 | 
|                                                 
|                                                 
|                                                 
|                                                 
|Gross profit                                      |  |                                          | 107,717 |         |  |         | 117,661 |         |  |   | 127,031 |  |  |   | 120,903 | 
|                                                 
|                                                 
|                                                 
|                                                 
|Transition and integration expenses               |  |                                          | 3,075   |         |  |         |        |         |  |   |        |  |  |   |        | 
|                                                 
|                                                 
|                                                 
|                                                 
|Write-off of unamortized management fee           |  |                                          | 3,643   |         |  |         |        |         |  |   |        |  |  |   |        | 
|                                                 
|                                                 
|                                                 
|                                                 
|Secondary stock offering costs                    |  |                                          |        |         |  |         |        |         |  |   |        |  |  |   | 770     | 
|                                                 
|                                                 
|                                                 
|                                                 
|Operating profit(4)                               |  |                                          | 7,976   |         |  |         | 22,239  |         |  |   | 23,510  |  |  |   | 20,236  | 
|                                                 
|                                                 
|                                                 
|                                                 
|Extraordinary loss, net of $4,236 of income taxes |  |                                          | (6,767  | )       |  |         |        |         |  |   |        |  |  |   |        | 
|                                                 
|                                                 
|                                                 
|                                                 
|Net income (loss)(5)                              |  |                                          | (7,519  | )       |  |         | 9,342   |         |  |   | 10,527  |  |  |   | 8,368   | 
|                                                 
|                                                 
|                                                 
|                                                 
|Basic earnings (loss) per share(3)                |  |                                          | (0.32   | )       |  |         | 0.34    |         |  |   | 0.38    |  |  |   | 0.30    | 
|                                                 
|                                                 
|                                                 
|                                                 
|Diluted earnings (loss) per share(3)              |  |                                          | (0.32   | )       |  |         | 0.33    |         |  |   | 0.37    |  |  |   | 0.29    | 
|                                                 
|                                                 
|                                                 
|                                                 
|EBITDA                                            |  | $                                        | 20,443  |         |  | $       | 27,877  |         |  | $ | 28,979  |  |  | $ | 26,562  | 




|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Operating profit during fiscal 1999 was negatively affected by
	non-recurring charges of $30.2 million related to the transition
	and integration of the 86 Big Wheel stores and the 194 AGA stores
	 (see Note 3 to our Consolidated Financial Statements), as
	well as $2.5 million of non-recurring store closing costs.                                                                                                                                                                                                                                                                            
|   
|(2) | Net income in the first quarter of fiscal 1999 was negatively
	affected by a $0.7 million cumulative effect of change in
	accounting principle, net of a $0.5 million benefit for income
	taxes, as a result of a change in the accounting literature with
	respect to the timing of recognition for store pre-opening
	expenses.                                                                                                                                                                                                                                                                      
|   
|(3) | The sum of the quarterly earnings (loss) per share amounts
	within a fiscal year may differ from the total earnings
	(loss) per share for the fiscal year due to the impact of
	differing weighted average share outstanding calculations.                                                                                                                                                                                                                                                                                                                                                             
|   
|(4) | Operating profit in the first quarter of fiscal 1998 was
	negatively affected by non-recurring charges of $3.1 million
	related to the transition and integration of the 82 Trak West
	stores (see Note 3 to our Consolidated Financial Statements)
	 and a $3.6 million write-off of the remaining unamortized
	balance of a prepaid management consulting and advisory services
	agreement that terminated upon consummation of our IPO. Operating
	 profit in the fourth quarter of fiscal 1998 was negatively
	affected by non-recurring charges of $.8 million related to our
	Secondary Offering.
|   
|(5) | Net income in the first quarter of fiscal 1998 was negatively
	affected by a $6.8 million extraordinary loss, net of a $4.2
	million benefit for income taxes, which consisted of prepayment
	premiums paid in connection with redemption of debt and the
	write-off of a portion of deferred debt issuance costs, as well
	as by the charges discussed in note (4)  above, net of
	income taxes.                                                                                                                                                                                                      

27



---



Inflation

We do not believe our operations have been materially affected by
 inflation. We believe that we will be able to mitigate the
effects of future merchandise cost increases principally through
economies of scale resulting from increased volumes of purchases,
 selective forward buying and the use of alternative suppliers.

Recent Accounting Pronouncements

In March 1998, the Accounting Standards Executive Committee
of the American Institute of Certified Public Accountants issued
Statement of Position (SOP) 98-1,
Accounting for the Cost of Computer Software Developed or
Obtained for Internal Use. The SOP defines the
characteristics of internal-use computer software, the criteria
for capitalization and financial statement disclosure
requirements. The SOP is effective for fiscal years beginning
after December 15, 1998, with earlier application
encouraged. We adopted SOP 98-1 in the first quarter of
fiscal 1999 and such adoption did not have a material effect on
our financial condition or results of operations.

In April 1998, the Accounting Standards Executive Committee
of the American Institute of Certified Public Accountants issued
SOP 98-5, Reporting on the Cost of Start-up
Activities. The SOP broadly defines start-up activities as
those one-time activities related to opening a new facility,
introducing a new product or service, conducting business in a
new territory, or commencing some new operation. The SOP requires
 that the costs of start-up activities be expensed as incurred
and is effective for financial statements for fiscal years
beginning after December 15, 1998, with earlier application
encouraged. Our historical accounting policy with respect to the
cost of start-up activities (store preopening expenses) was to
defer such costs for the approximately three month period of time
 that it takes to develop a new store facility and to expense
such costs during the month that the new store opens. We adopted
SOP 98-5 in the first quarter of fiscal 1999, which required us
to change our accounting policy to expense start-up costs as
incurred. Upon adoption, we expensed approximately $741,000, net
of an income tax benefit of $468,000, of preopening expenses that
 had been deferred as of January 31, 1999. Such expense is
reflected in the accompanying consolidated statement of
operations as the cumulative effect of a change in accounting
principle.

In June 1998, the Financial Accounting Standards Board
(FASB) issued SFAS No. 133, Accounting for
 Derivative Instruments and Hedging Activities. This
Statement establishes accounting and reporting standards for
derivative instruments and for hedging activities. It requires
companies to recognize all derivatives as either assets or
liabilities in their statement of financial position and measure
those instruments at fair value. In September 1999, the FASB
 issued SFAS No. 137, Accounting for Derivative
Instruments and Hedging Activities-Deferral of the Effective Date
 of FASB Statement No. 133, which delayed the
effective date of SFAS No. 133 to fiscal years beginning
after June 15, 2000. We are analyzing the implementation
requirements and currently do not anticipate there will be a
material impact on our financial position or the results of our
operations.

Item 7A.  Quantitative and Qualitative
Disclosures about Market Risk

Financial market risks relating to our operations result
primarily from changes in interest rates. Interest earned on our
cash equivalents as well as interest paid on our variable rate
debt are sensitive to changes in interest rates. Our variable
rate debt relates to borrowings under our Senior Credit Facility,
 which is primarily vulnerable to movements in the LIBOR rate.
Our fixed rate debt consists primarily of our 11% Senior
Subordinated Notes and capital lease obligations. Our exposure to
 interest rate risk increased during fiscal 1999 due to increases
 in corresponding interest rates as well as increased debt
balances in conjunction with our recent acquisitions.

We currently utilize no derivative financial instruments that
expose us to significant market risk. While we cannot predict the
 impact interest rate movements will have on our debt, we believe
 the exposure to interest rate risk is not material to our
financial position or results of operations.

Item 8.  Consolidated Financial Statements
and Supplementary Data

28



---



REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders



In our opinion, the consolidated financial statements listed in
the index appearing under Item 14(a)(1) on page 58
present fairly, in all material respects, the financial position
of CSK Auto Corporation and its subsidiary at January 30,
2000 and January 31, 1999, and the results of their
operations and their cash flows for each of the three years in
the period ended January 30, 2000 in conformity with
accounting principles generally accepted in the United States of
America. These financial statements are the responsibility of the
 Companys management; our responsibility is to express an
opinion on these financial statements. We conducted our audits of
 these statements in accordance with auditing standards generally
 accepted in the United States of America, which require that we
plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed
above.

PRICEWATERHOUSECOOPERS LLP

Phoenix, Arizona



29



---



CSK AUTO CORPORATION AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)


|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |            |  
|------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------- | ----------------- | --------- | ----------- | - | ----------- | --------- | ---------- | - | - | ------- | ---------- | -
|                                                                                                        |                                                                                           |                  
|                                                                                                        |                                                                                           | Fiscal Year Ended
|                                                                                                        |                                                                                           |                  
|                                                                                                        |                                                                                           | January 30,       |           | January 31, |   | February 1,
|                                                                                                        |                                                                                           | 2000              |           | 1999        |   | 1998       
|                                                                                                        |                                                                                           |                   |           |             |   |            
|Net sales                                                                                               |                                                                                           | $                 | 1,231,455 |             |   | $           | 1,004,385 |            |   | $ | 845,815 |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Cost of sales                                                                                           |                                                                                           |                   | 636,239   |             |   |             | 531,073   |            |   |   | 468,171 |           
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Gross profit                                                                                            |                                                                                           |                   | 595,216   |             |   |             | 473,312   |            |   |   | 377,644 |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Other costs and expenses:                                                                               |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Operating and administrative                                                              |                   |           | 471,340     |   |             |           | 391,528    |   |   |         | 326,198    |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Store closing costs                                                                       |                   |           | 4,900       |   |             |           | 335        |   |   |         | 1,640      |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Transition and integration expenses                                                       |                   |           | 30,187      |   |             |           | 3,075      |   |   |         | 3,407      |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Goodwill amortization                                                                     |                   |           | 1,941       |   |             |           |           |   |   |         |           |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Stock-based compensation                                                                  |                   |           |            |   |             |           |           |   |   |         | 909        |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Write-off of unamortized management fee                                                   |                   |           |            |   |             |           | 3,643      |   |   |         |           |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Secondary stock offering costs                                                            |                   |           |            |   |             |           | 770        |   |   |         |           |  
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Operating profit                                                                                        |                                                                                           |                   | 86,848    |             |   |             | 73,961    |            |   |   | 45,490  |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Other 1996 Recapitalization expenses                                                                    |                                                                                           |                   |          |             |   |             |          |            |   |   | 1,009   |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Interest expense, net                                                                                   |                                                                                           |                   | 41,300    |             |   |             | 30,730    |            |   |   | 40,680  |           
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Income before income taxes, extraordinary loss and cumulative
	effect of change in accounting principle |                                                                                           |                   | 45,548    |             |   |             | 43,231    |            |   |   | 3,801   |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Income tax expense                                                                                      |                                                                                           |                   | 17,436    |             |   |             | 15,746    |            |   |   | 1,557   |           
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Income before extraordinary loss and cumulative effect of change
	in accounting principle               |                                                                                           |                   | 28,112    |             |   |             | 27,485    |            |   |   | 2,244   |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Extraordinary loss, net of $4,236 and $2,091 of income taxes                                            |                                                                                           |                   |          |             |   |             | (6,767    | )          |   |   | (3,015  | )         
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Income (loss) before cumulative effect of change in accounting
	principle                               |                                                                                           |                   | 28,112    |             |   |             | 20,718    |            |   |   | (771    | )         
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Cumulative effect of change in accounting principle, net of $468
	of income taxes                       |                                                                                           |                   | (741      | )           |   |             |          |            |   |   |        |           
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Net income (loss)                                                                                       |                                                                                           | $                 | 27,371    |             |   | $           | 20,718    |            |   | $ | (771    | )         
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Basic earnings (loss) per share:                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Income before extraordinary loss and cumulative effect of change
	in accounting principle |                   | $         | 1.01        |   |             | $         | 1.03       |   |   | $       | 0.13       |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Extraordinary loss, net of income taxes                                                   |                   |           |            |   |             |           | (0.25      | ) |   |         | (0.17      | )
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                        | Income (loss) before cumulative effect of change in accounting
	principle                 |                   |           | 1.01        |   |             |           | 0.78       |   |   |         | (0.04      | )
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Cumulative effect of change in accounting principle, net of
	income taxes                 |                   |           | (0.03       | ) |             |           |           |   |   |         |           |  
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                        | Net income (loss)                                                                         |                   | $         | 0.98        |   |             | $         | 0.78       |   |   | $       | (0.04      | )
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                        | Shares used in computing per share amounts                                                |                   |           | 27,815,160  |   |             |           | 26,722,322 |   |   |         | 17,400,214 |  
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|Diluted earnings (loss) per share:                                                                      |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Income before extraordinary loss and cumulative effect of change
	in accounting principle |                   | $         | 0.98        |   |             | $         | 0.99       |   |   | $       | 0.12       |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Extraordinary loss, net of income taxes                                                   |                   |           |            |   |             |           | (0.24      | ) |   |         | (0.16      | )
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                        | Income (loss) before cumulative effect of change in accounting
	principle                 |                   |           | 0.98        |   |             |           | 0.75       |   |   |         | (0.04      | )
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                        | Cumulative effect of change in accounting principle, net of
	income taxes                 |                   |           | (0.02       | ) |             |           |           |   |   |         |           |  
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                        | Net income (loss)                                                                         |                   | $         | 0.96        |   |             | $         | 0.75       |   |   | $       | (0.04      | )
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           
|                                                                                                        | Shares used in computing per share amounts                                                |                   |           | 28,626,776  |   |             |           | 27,640,099 |   |   |         | 18,011,666 |  
|                                                                                                        |                                                                                           |                   |           |             |   |             |           |            |   |   |         |           

The accompanying notes are an integral part of these consolidated
 financial statements.

30



---



CSK AUTO CORPORATION AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |          |         | 
|----------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------- | ----------- | --------- | - | ------- | -------- | ------- | 
|                                                                  |                                                                                                                                                                               | January 30,                                |         | January 31,
|                                                                  |                                                                                                                                                                               | 2000                                       |         | 1999       
|                                                                  |                                                                                                                                                                               |                                            |         |            
|ASSETS                                                           
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Cash and cash equivalents                                         |                                                                                                                                                                               | $                                          | 11,762  |             |           | $ | 7,490   |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Receivables, net of allowances of $3,294 and $1,703, respectively |                                                                                                                                                                               |                                            | 69,129  |             |           |   | 58,867  |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Inventories                                                       |                                                                                                                                                                               |                                            | 625,480 |             |           |   | 414,422 |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Assets held for sale                                              |                                                                                                                                                                               |                                            | 4,745   |             |           |   | 5,018   |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Prepaid expenses and other current assets                         |                                                                                                                                                                               |                                            | 18,471  |             |           |   | 18,295  |         
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                  |                                                                                                                                                                               | Total current assets                       |         |             | 729,587   |   |         |          | 504,092 | 
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|Property and equipment, net                                       |                                                                                                                                                                               |                                            | 160,561 |             |           |   | 102,383 |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Leasehold interests, net                                          |                                                                                                                                                                               |                                            | 8,341   |             |           |   | 9,643   |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Deferred income taxes                                             |                                                                                                                                                                               |                                            |        |             |           |   | 10,695  |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Goodwill, net                                                     |                                                                                                                                                                               |                                            | 124,750 |             |           |   | 193     |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Other assets, net                                                 |                                                                                                                                                                               |                                            | 12,413  |             |           |   | 7,016   |         
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                  |                                                                                                                                                                               | Total assets                               |         | $           | 1,035,652 |   |         | $        | 634,022 | 
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|LIABILITIES AND STOCKHOLDERS EQUITY                             
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Accounts payable                                                  |                                                                                                                                                                               | $                                          | 168,770 |             |           | $ | 122,304 |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Accrued payroll and related expenses                              |                                                                                                                                                                               |                                            | 38,910  |             |           |   | 25,962  |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Accrued expenses and other current liabilities                    |                                                                                                                                                                               |                                            | 50,663  |             |           |   | 35,312  |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Current maturities of amounts due under Senior Credit Facility    |                                                                                                                                                                               |                                            | 3,340   |             |           |   | 840     |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Current maturities of capital lease obligations                   |                                                                                                                                                                               |                                            | 9,893   |             |           |   | 8,749   |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Deferred income taxes                                             |                                                                                                                                                                               |                                            | 1,417   |             |           |   | 4,046   |         
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                  |                                                                                                                                                                               | Total current liabilities                  |         |             | 272,993   |   |         |          | 197,213 | 
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|Amounts due under Senior Credit Facility                          |                                                                                                                                                                               |                                            | 505,480 |             |           |   | 224,320 |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Obligations under 11% Senior Subordinated Notes                   |                                                                                                                                                                               |                                            | 81,250  |             |           |   | 81,250  |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Obligations under capital leases                                  |                                                                                                                                                                               |                                            | 27,170  |             |           |   | 18,134  |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Deferred income taxes                                             |                                                                                                                                                                               |                                            | 5,801   |             |           |   |        |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Other                                                             |                                                                                                                                                                               |                                            | 8,411   |             |           |   | 7,716   |         
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                  |                                                                                                                                                                               | Total non-current liabilities              |         |             | 628,112   |   |         |          | 331,420 | 
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|Commitments and contingencies                                     |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Stockholders equity:                                             |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Common stock, $0.01 par value, 50,000,000 shares authorized,
	27,834,574 and 27,768,832 shares issued and outstanding at
	January 30, 2000 and January 31, 1999, respectively |                                            |         | 278         |           |   |         | 278      |        
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Additional paid-in capital                                                                                                                                                    |                                            |         | 291,004     |           |   |         | 289,820  |        
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Stockholder receivable                                                                                                                                                        |                                            |         | (584        | )         |   |         | (1,018   | )      
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Deferred compensation                                                                                                                                                         |                                            |         | (324        | )         |   |         | (493     | )      
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Accumulated deficit                                                                                                                                                           |                                            |         | (155,827    | )         |   |         | (183,198 | )      
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                  |                                                                                                                                                                               | Total stockholders equity                 |         |             | 134,547   |   |         |          | 105,389 | 
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         
|                                                                  |                                                                                                                                                                               | Total liabilities and stockholders equity |         | $           | 1,035,652 |   |         | $        | 634,022 | 
|                                                                  |                                                                                                                                                                               |                                            |         |             |           |   |         |         

The accompanying notes are an integral part of these consolidated
 financial statements.

31



---



CSK AUTO CORPORATION AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY (DEFICIT)

(in thousands, except share data)


|                                                                               |  |              |            |            |  |             |     |            |  |              |         |         |  |           |        |   |  |   |      |   |  |   |          |   |  |   |          |  
|------------------------------------------------------------------------------ |  | ------------ | ---------- | ---------- |  | ----------- | --- | ---------- |  | ------------ | ------- | ------- |  | --------- | ------ | - |  | - | ---- | - |  | - | -------- | - |  | - | -------- | -
|                                                                               |  |              |            |            |  |             |     |            |  |              |         |        
|                                                                               |  | Common Stock |            | Additional |  |             |     |            |  |              |         | Total  
|                                                                               |  |              |            | Paid-in    |  | Stockholder |     | Deferred   |  | Accumulated  |         | Equity 
|                                                                               |  | Shares       |            | Amount     |  | Capital     |     | Receivable |  | Compensation |         | Deficit |  | (Deficit)
|                                                                               |  |              |            |            |  |             |     |            |  |              |         |         |  |          
|Balances at February 2, 1997                                                   |  |              | 17,105,000 |            |  | $           | 171 |            |  | $            | 106,677 |         |  | $         | (5,966 | ) |  | $ |     |   |  | $ | (203,145 | ) |  | $ | (102,263 | )
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Recovery of stockholder receivable                                             |  |              |           |            |  |             |    |            |  |              |        |         |  |           | 5,966  |   |  |   |     |   |  |   |         |   |  |   | 5,966    |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Sale of Class B stock                                                          |  |              | 180,600    |            |  |             | 2   |            |  |              | 2,172   |         |  |           | (1,168 | ) |  |   |     |   |  |   |         |   |  |   | 1,006    |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Sale of stock  Trak West Acquisition                                          |  |              | 1,827,788  |            |  |             | 18  |            |  |              | 20,989  |         |  |           |       |   |  |   |     |   |  |   |         |   |  |   | 21,007   |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Deferred compensation                                                          |  |              |           |            |  |             |    |            |  |              | 675     |         |  |           |       |   |  |   | (675 | ) |  |   |         |   |  |   |         |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Net loss                                                                       |  |              |           |            |  |             |    |            |  |              |        |         |  |           |       |   |  |   |     |   |  |   | (771     | ) |  |   | (771     | )
|                                                                               |  |              |            |            |  |             |     |            |  |              |         |         |  |           |        |   |  |   |      |   |  |   |          |   |  |   |          |  
|Balances at February 1, 1998.                                                  |  |              | 19,113,388 |            |  | $           | 191 |            |  | $            | 130,513 |         |  | $         | (1,168 | ) |  | $ | (675 | ) |  | $ | (203,916 | ) |  | $ | (75,055  | )
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Amortization of deferred compensation                                          |  |              |           |            |  |             |    |            |  |              |        |         |  |           |       |   |  |   | 182  |   |  |   |         |   |  |   | 182      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Recovery of stockholder receivable                                             |  |              |           |            |  |             |    |            |  |              |        |         |  |           | 150    |   |  |   |     |   |  |   |         |   |  |   | 150      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Issuance of common stock in initial public offering, net of
	transaction costs |  |              | 8,625,000  |            |  |             | 86  |            |  |              | 158,537 |         |  |           |       |   |  |   |     |   |  |   |         |   |  |   | 158,623  |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Stock compensation                                                             |  |              |           |            |  |             |    |            |  |              | 220     |         |  |           |       |   |  |   |     |   |  |   |         |   |  |   | 220      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Exercise of options                                                            |  |              | 30,444     |            |  |             | 1   |            |  |              | 366     |         |  |           |       |   |  |   |     |   |  |   |         |   |  |   | 367      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Tax benefit of exercise of options                                             |  |              |           |            |  |             |    |            |  |              | 184     |         |  |           |       |   |  |   |     |   |  |   |         |   |  |   | 184      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Net income                                                                     |  |              |           |            |  |             |    |            |  |              |        |         |  |           |       |   |  |   |     |   |  |   | 20,718   |   |  |   | 20,718   |  
|                                                                               |  |              |            |            |  |             |     |            |  |              |         |         |  |           |        |   |  |   |      |   |  |   |          |   |  |   |          |  
|Balances at January 31, 1999                                                   |  |              | 27,768,832 |            |  | $           | 278 |            |  | $            | 289,820 |         |  | $         | (1,018 | ) |  | $ | (493 | ) |  | $ | (183,198 | ) |  | $ | 105,389  |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Amortization of deferred compensation                                          |  |              |           |            |  |             |    |            |  |              |        |         |  |           |       |   |  |   | 169  |   |  |   |         |   |  |   | 169      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Recovery of stockholder receivable                                             |  |              |           |            |  |             |    |            |  |              |        |         |  |           | 434    |   |  |   |     |   |  |   |         |   |  |   | 434      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Exercise of options                                                            |  |              | 65,742     |            |  |             |    |            |  |              | 791     |         |  |           |       |   |  |   |     |   |  |   |         |   |  |   | 791      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Tax benefit relating to stock option exercises                                 |  |              |           |            |  |             |    |            |  |              | 393     |         |  |           |       |   |  |   |     |   |  |   |         |   |  |   | 393      |  
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Net income                                                                     |  |              |           |            |  |             |    |            |  |              |        |         |  |           |       |   |  |   |     |   |  |   | 27,371   |   |  |   | 27,371   |  
|                                                                               |  |              |            |            |  |             |     |            |  |              |         |         |  |           |        |   |  |   |      |   |  |   |          |   |  |   |          |  
|Balances at January 30, 2000                                                   |  |              | 27,834,574 |            |  | $           | 278 |            |  | $            | 291,004 |         |  | $         | (584   | ) |  | $ | (324 | ) |  | $ | (155,827 | ) |  | $ | 134,547  |  
|                                                                               |  |              |            |            |  |             |     |            |  |              |         |         |  |           |        |   |  |   |      |   |  |   |          |   |  |   |          |  

The accompanying notes are an integral part of these consolidated
 financial statements.

32



---



CSK AUTO CORPORATION AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)


|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |          |   |        |         |  
|------------------------------------------------------ | ---------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------- | --------------------------------------------------------------- | - | ----------- | -------- | ------- | - | ------ | ------- | -------- | - | ------ | ------- | -
|                                                       |                                                                        |                                                                                                    
|                                                       |                                                                        | Fiscal Year Ended                                                                                  
|                                                       |                                                                        |                                                                                                    
|                                                       |                                                                        | January 30,                                                                                         |                                                                              | January 31,                                                     |   | February 1,
|                                                       |                                                                        | 2000                                                                                                |                                                                              | 1999                                                            |   | 1998       
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |            
|Cash flows provided by (used in) operating activities: |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Net income (loss)                                                      |                                                                                                     | $                                                                            | 27,371                                                          |   |             | $        | 20,718  |   |        | $       | (771     | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        | Adjustments to reconcile net income (loss) to net cash provided
	by (used in) operating activities: |                                                                              |                                                                 |   |             |          |         |   |        |         |          |   |       
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Depreciation and amortization of property and equipment                      |                                                                 |   | 26,066      |          |         |   | 20,930 |         |          |   | 18,078 |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Amortization of goodwill                                                     |                                                                 |   | 1,941       |          |         |   |       |         |          |   |       |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Amortization of leasehold interests                                          |                                                                 |   | 761         |          |         |   | 919    |         |          |   | 1,176  |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Amortization of other deferred charges                                       |                                                                 |   | 607         |          |         |   | 563    |         |          |   | 1,113  |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Amortization of deferred financing costs                                     |                                                                 |   | 1,406       |          |         |   | 1,016  |         |          |   | 2,043  |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Tax benefit relating to stock option exercises                               |                                                                 |   | 393         |          |         |   | 184    |         |          |   |       |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Extraordinary loss on early retirement of debt, net of income
	taxes         |                                                                 |   |            |          |         |   | 6,767  |         |          |   | 3,015  |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Cumulative effect of change in accounting principle, net of
	income taxes    |                                                                 |   | 741         |          |         |   |       |         |          |   |       |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Write-off of unamortized deferred charge                                     |                                                                 |   |            |          |         |   | 3,643  |         |          |   |       |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Deferred income taxes                                                        |                                                                 |   | 15,637      |          |         |   | 15,542 |         |          |   | 1,557  |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     | Change in operating assets and liabilities, net of effects of
	acquisitions: |                                                                 |   |             |          |         |   |        |         |          |   |        |        
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     |                                                                              | Receivables                                                     |   |             | (5,812   | )       |   |        | (21,056 | )        |   |        | (9,055  | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     |                                                                              | Inventories                                                     |   |             | (93,567  | )       |   |        | (45,848 | )        |   |        | (63,830 | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     |                                                                              | Prepaid expenses and other current assets                       |   |             | 7,240    |         |   |        | (200    | )        |   |        | (4,057  | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     |                                                                              | Accounts payable                                                |   |             | 11,203   |         |   |        | 7,925   |          |   |        | (13,732 | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     |                                                                              | Accrued payroll, accrued expenses and other current liabilities |   |             | 2,793    |         |   |        | (947    | )        |   |        | (1,760  | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       |                                                                        |                                                                                                     |                                                                              | Other operating activities                                      |   |             | (811     | )       |   |        | (6,753  | )        |   |        | 3,520   |  
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|                                                       |                                                                        |                                                                                                     |                                                                              | Net cash provided by (used in) operating activities             |   |             | (4,031   | )       |   |        | 3,403   |          |   |        | (62,703 | )
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|Cash flows provided by (used in) investing activities: |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Business acquisitions, net of cash acquired                            |                                                                                                     |                                                                              | (218,201                                                        | ) |             |          | (892    | ) |        |         | (34,504  | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Capital expenditures                                                   |                                                                                                     |                                                                              | (41,358                                                         | ) |             |          | (37,846 | ) |        |         | (20,132  | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Expenditures for assets held for sale                                  |                                                                                                     |                                                                              | (7,400                                                          | ) |             |          | (19,144 | ) |        |         | (12,335  | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Proceeds from sale of property and equipment and assets held for
	sale |                                                                                                     |                                                                              | 8,760                                                           |   |             |          | 21,650  |   |        |         | 10,966   |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Due to affiliate                                                       |                                                                                                     |                                                                              |                                                                |   |             |          | (1,000  | ) |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Other investing activities                                             |                                                                                                     |                                                                              | (2,022                                                          | ) |             |          | (292    | ) |        |         | (722     | )
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|                                                       |                                                                        |                                                                                                     |                                                                              | Net cash used in investing activities                           |   |             | (260,221 | )       |   |        | (37,524 | )        |   |        | (56,727 | )
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|Cash flows provided by (used in) financing activities: |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Borrowings under Senior Credit Facility                                |                                                                                                     |                                                                              | 502,000                                                         |   |             |          | 126,000 |   |        |         | 325,550  |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Payments under Senior Credit Facility                                  |                                                                                                     |                                                                              | (218,340                                                        | ) |             |          | (87,065 | ) |        |         | (223,500 | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Issuance of common stock in initial public offering,                   |                                                                                                     |                                                                              |                                                                |   |             |          | 172,482 |   |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Underwriters discount and other IPO costs                             |                                                                                                     |                                                                              |                                                                |   |             |          | (13,859 | ) |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Premiums paid upon early retirement of debt                            |                                                                                                     |                                                                              |                                                                |   |             |          | (4,875  | ) |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Retirement of 11% Senior Subordinated Notes                            |                                                                                                     |                                                                              |                                                                |   |             |          | (43,750 | ) |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Retirement of 12% Subordinated Notes                                   |                                                                                                     |                                                                              |                                                                |   |             |          | (50,000 | ) |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Payment of Senior Credit Facility with public offering proceeds        |                                                                                                     |                                                                              |                                                                |   |             |          | (53,825 | ) |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Payment of debt issuance costs                                         |                                                                                                     |                                                                              | (4,730                                                          | ) |             |          |        |   |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Payments on capital lease obligations                                  |                                                                                                     |                                                                              | (10,905                                                         | ) |             |          | (8,634  | ) |        |         | (7,478   | )
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Issuance of Class B stock                                              |                                                                                                     |                                                                              |                                                                |   |             |          |        |   |        |         | 21,714   |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Recovery of stockholder receivable                                     |                                                                                                     |                                                                              | 434                                                             |   |             |          | 150     |   |        |         | 5,966    |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Exercise of options                                                    |                                                                                                     |                                                                              | 791                                                             |   |             |          | 367     |   |        |         |         |  
|                                                      
|                                                      
|                                                      
|                                                      
|                                                       | Other financing activities                                             |                                                                                                     |                                                                              | (726                                                            | ) |             |          | (232    | ) |        |         | (3,193   | )
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|                                                       |                                                                        |                                                                                                     |                                                                              | Net cash provided by financing activities                       |   |             | 268,524  |         |   |        | 36,759  |          |   |        | 119,059 |  
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|                                                       |                                                                        |                                                                                                     |                                                                              | Net increase (decrease) in cash and cash equivalents            |   |             | 4,272    |         |   |        | 2,638   |          |   |        | (371    | )
|                                                      
|                                                      
|                                                      
|                                                      
|Cash and cash equivalents, beginning of period         |                                                                        |                                                                                                     | 7,490                                                                        |                                                                 |   |             | 4,852    |         |   |        | 5,223   |         
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         
|Cash and cash equivalents, end of period               |                                                                        | $                                                                                                   | 11,762                                                                       |                                                                 |   | $           | 7,490    |         |   | $      | 4,852   |         
|                                                       |                                                                        |                                                                                                     |                                                                              |                                                                 |   |             |          |         |   |        |         |         

The accompanying notes are an integral part of these consolidated
 financial statements.

33



---



CSK AUTO CORPORATION AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

CSK Auto Corporation is a holding company. At January 30,
2000, CSK Auto Corporation had no business activity other than
its investment in CSK Auto, Inc., a wholly-owned subsidiary
(Auto). On a consolidated basis, CSK Auto Corporation
 and subsidiary are referred to herein as the
Company.

CSK Auto, Inc. is a specialty retailer of automotive aftermarket
parts and accessories. At January 30, 2000, the Company
operated 1,120 stores in 18 Western and Northern Plains states as
 a fully integrated company under three brand names: Checker Auto
 Parts, founded in 1969 and operating in the Southwestern, Rocky
Mountain and Northern Plains states; Schucks Auto Supply,
founded in 1917 and operating in the Pacific Northwest; and
Kragen Auto Parts, founded in 1947 and operating primarily in
California.

Note 1  Summary of Significant Accounting
Policies

Principles of Consolidation

The consolidated financial statements include the accounts of CSK
 Auto Corporation and Auto for all years presented. In addition,
the accounts of Automotive Information Systems, Inc.
(AIS) are included in the accompanying financial
statements from September 7, 1999, the date of acquisition
(see Note 3). All intercompany accounts and transactions are
 eliminated in consolidation.

Fiscal Year

The Companys fiscal year end is on the Sunday nearest to
January 31 of the following calendar year. The fiscal years
ended January 30, 2000 (fiscal 1999),
January 31, 1999 (fiscal 1998) and
February 1, 1998 (fiscal 1997) each
consisted of 52 weeks.

Revenue Recognition

The Company recognizes sales upon the delivery of products to its
 customers, which generally occurs at the Companys retail
store locations. For commercial customers, the Company also
delivers products to customer locations. All retail and
commercial sales are final upon delivery of products. However, as
 a convenience to the customer and as typical of most retailers,
the Company will accept merchandise returns. The Company
generally limits the period of time within which products may be
returned to 30 days and requires returns to be accompanied
by original packaging and a sales receipt. The accompanying
financial statements include an allowance for sales returns,
which has been estimated by management based upon historical
activity.

Cash Equivalents

Cash equivalents consist primarily of certificates of deposit
with maturities of three months or less when purchased.

Receivables

Receivables are primarily comprised of amounts due from vendors
for rebates or allowances and from commercial sales customers.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to
concentration of credit risk consist principally of cash and cash
 equivalents and trade receivables. As of January 30, 2000,
the Company had cash and cash equivalents on deposit with a major
 financial institution that were in excess of FDIC insured
limits. Historically, the Company has not experienced any loss of
 its cash and cash equivalents due to such concentration of
credit risk.

34



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

The Company does not hold collateral to secure payment of its
trade accounts receivable. However, management performs ongoing
credit evaluations of its customers financial condition and
 provides an allowance for estimated potential losses. Exposure
to credit loss is limited to the carrying amount.

Inventories and Cost of Sales

Inventories are valued at the lower of cost or market, cost being
 determined utilizing the last-in, first-out method. Cost of
sales includes product cost, net of earned vendor rebates,
discounts and allowances. The Company recognizes vendor rebates,
discounts and allowances based on the terms of the underlying
agreements. Such amounts may be amortized over the life of the
applicable agreements or recognized as inventory is sold. Certain
 operating and administrative costs associated with purchasing
and handling of inventory are capitalized in inventories. The
amounts of such costs included in inventories as of
January 30, 2000 and January 31, 1999 were
approximately $31.8 million and $17.9 million, respectively. In
addition, the Company increases cost of sales and reduces
inventory by an estimate of purchase discounts and volume rebates
 that are unearned at period end, based upon inventory turnover
rates. Such capitalized purchase discounts totaled $23.5 million
and $13.2 million as of January 30, 2000 and
January 31, 1999, respectively. The replacement cost of
inventories approximated $548.3 million and $356.7 million at
January 30, 2000 and January 31, 1999, respectively.

Property and Equipment

Property, equipment and purchased software are recorded at cost.
Depreciation and amortization are computed for financial
reporting purposes utilizing primarily the straight-line method
over the estimated useful lives of the related assets, which
range from 5 to 25 years, or for leasehold improvements and
property under capital lease, the base lease term or estimated
useful life, if shorter. Maintenance and repairs are charged to
earnings when incurred.

Store Preopening Costs

During the first quarter of fiscal 1999, the Company adopted
Statement of Position (SOP) 98-5, Reporting on
the Cost of Start-up Activities. SOP 98-5 requires
that store preopening costs, consisting primarily of incremental
labor, supplies and occupancy costs directly related to the
opening of specific stores, be expensed as incurred. Previously,
the Company capitalized such costs as prepaid expenses and other
current assets and expensed them during the month in which the
store was opened. See Note 2.

Internal Software Development Costs

During the first quarter of fiscal 1999, the Company adopted SOP
98-1 Accounting for the Cost of Computer Software Developed
 or Obtained for Internal Use. SOP 98-1 provides for
the capitalization of certain internal software development costs
 and amortization over the life of the related software.
Previously, internal software development costs, consisting
primarily of incremental internal labor costs and benefits, were
expensed as incurred. Amounts capitalized during 1999 were $1.7
million with accumulated amortization of $0.2 million as of
January 30, 2000. Total amounts charged to operations for
fiscal years 1998 and 1997 were approximately $1.6 million and
$1.3 million, respectively.

Leasehold Interests

Leasehold interests represent the discounted net present value of
 the excess of the fair rental value over the respective
contractual rent of facilities under operating leases acquired in
 business combinations. Amortization expense is computed on a
straight-line basis over the respective lease terms. Accumulated
amortization totaled $16.6 million and $16.2 million at
January 30, 2000 and January 31, 1999, respectively.

35



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

Goodwill

The cost in excess of net assets acquired is amortized on a
straight-line basis over periods ranging from 20 to
30 years, depending on the business acquired. Management
estimates such periods using factors such as entry barriers in
certain regions, operating rights and estimated lives of other
operating assets acquired. The realizability of goodwill and
other intangibles is evaluated periodically when events or
circumstances indicate a possible inability to recover the
carrying amount. Such evaluation is based on cash flow and
profitability projections that incorporate the impact of existing
 Company businesses. The analyses necessarily involve significant
 management judgment to evaluate the capacity of an acquired
business to perform within projections. Accumulated amortization
as of January 30, 2000 was $1.9 million.

Store Closing Costs

The Company provides an allowance for estimated costs and losses
to be incurred in connection with store closures and losses on
the disposal of store-related assets, which is net of anticipated
 sublease income. Such costs are recognized when a store is
specifically identified, costs can be estimated and closure is
planned to be completed within the next twelve months. See
Note 12.

Advertising

The Company expenses all advertising costs as such costs are
incurred. Amounts due under vendor cooperative advertising
agreements are recorded as receivables until their collection.
Advertising expense for fiscal 1999, 1998 and 1997 totaled
approximately $16.5 million, $21.9 million and $23.7 million, net
 of vendor funded cooperative advertising, respectively.

Assets Held for Sale

Assets held for sale consist of newly acquired land, buildings
and store fixtures owned by the Company which the Company intends
 in the next twelve months to sell to and lease back from third
parties under lease arrangements.

Long-lived Assets

The Company applies Statement of Financial Accounting Standards
(SFAS) No. 121, Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be
Disposed Of, which requires that long-lived assets and
certain identifiable intangible assets to be held and used or
disposed of by an entity be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable. In the event assets
are impaired, losses are recognized based on the excess carrying
amount over the estimated fair value of the asset. SFAS
No. 121 also requires that assets to be disposed of be
reported at the lower of the carrying amount or the fair market
value less selling costs. The Company evaluates the carrying
value of long-lived assets on a quarterly basis to determine
whether events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable and an
impairment loss should be recognized. Such evaluation is based on
 the expected utilization of the related asset and the
corresponding useful life.

Income Taxes

Deferred income taxes are recognized for the tax consequences in
future years of differences between the tax basis of assets and
liabilities and their financial reporting amounts
(temporary differences) at each year end based on
enacted tax laws and statutory rates applicable to the period in
which the temporary differences are expected to affect taxable
income. Valuation allowances are established, when necessary, to
reduce deferred tax assets to the amount expected to be realized.
 Income tax expense includes both taxes payable for the period
and the change during the period in deferred tax assets and
liabilities.

36



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

Stock-Based Compensation

SFAS No. 123, Accounting for Stock-Based
Compensation, encourages but does not require companies to
record compensation cost for stock-based employee compensation
plans at fair value. The Company has chosen to continue to
account for stock-based compensation using the intrinsic value
method prescribed in Accounting Principles Board Opinion
No. 25, Accounting for Stock Issued to Employees
 and related interpretations thereof. Accordingly, compensation
cost for stock options is measured as the excess, if any, of the
market price of the Companys stock at the date of grant
over the amount an employee must pay to acquire the stock. See
Note 9.

Earnings per Share

Basic earnings per share is based on the weighted average
outstanding common shares. Diluted earnings per share is based on
 the weighted average outstanding shares adjusted for the effect
of stock options.

Calculation of shares used in computing per share amounts is
summarized as follows:

|                                            |                      |                   |            |             |  |             |            |            |  |  |            |            | 
|------------------------------------------- | -------------------- | ----------------- | ---------- | ----------- |  | ----------- | ---------- | ---------- |  |  | ---------- | ---------- | 
|                                            |                      |                  
|                                            |                      | Fiscal Year Ended
|                                            |                      |                  
|                                            |                      | January 30,       |            | January 31, |  | February 1,
|                                            |                      | 2000              |            | 1999        |  | 1998       
|                                            |                      |                   |            |             |  |            
|Common stock outstanding:                   |                      |                   |            |             |  |             |            |            |  |  |            |           
|                                           
|                                           
|                                           
|                                           
|                                            | Beginning of period  |                   |            | 27,768,832  |  |             |            | 19,113,388 |  |  |            | 17,105,000 | 
|                                            |                      |                   |            |             |  |             |            |            |  |  |            |           
|                                            | End of period        |                   |            | 27,834,574  |  |             |            | 27,768,832 |  |  |            | 19,113,388 | 
|                                            |                      |                   |            |             |  |             |            |            |  |  |            |           
|                                            | Issued during period |                   |            | 65,742      |  |             |            | 8,655,444  |  |  |            | 2,008,388  | 
|                                            |                      |                   |            |             |  |             |            |            |  |  |            |           
|Weighted average number of shares (basic)   |                      |                   | 27,815,160 |             |  |             | 26,722,322 |            |  |  | 17,400,214 |           
|                                           
|                                           
|                                           
|                                           
|Effects of dilutive securities              |                      |                   | 811,616    |             |  |             | 917,777    |            |  |  | 611,452    |           
|                                            |                      |                   |            |             |  |             |            |            |  |  |            |           
|Weighted average number of shares (diluted) |                      |                   | 28,626,776 |             |  |             | 27,640,099 |            |  |  | 18,011,666 |           
|                                            |                      |                   |            |             |  |             |            |            |  |  |            |           

Use of Estimates

The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and
 liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from these estimates.

Reclassifications

Certain prior year financial statement amounts have been
reclassified to conform to the current year presentation.



|         |                                                                                          
|-------- | -----------------------------------------------------------------------------------------
|Note 2  | Recent Accounting Pronouncements and Cumulative Effect of
	Change in Accounting Principle

In April 1998, the Accounting Standards Executive Committee
of the American Institute of Certified Public Accountants issued
SOP 98-5, Reporting on the Cost of Start-up
Activities. The SOP broadly defines start-up activities as
those one-time activities related to opening a new facility,
introducing a new product or service, conducting business in a
new territory, or commencing some new operation. The SOP requires
 that the costs of start-up activities be expensed as incurred
and is effective for financial statements for fiscal years
beginning after December 15, 1998, with earlier application
encouraged. The Companys historical accounting policy with
respect to the cost of start-up activities (store preopening
expenses) was to defer such

37



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

costs for the approximately three month period of time that it
takes to develop a new store facility and to expense such costs
during the month that the new store opens. The Company adopted
SOP 98-5 in the first quarter of fiscal 1999, which required
 the Company to change its accounting policy to expense start-up
costs as incurred. Upon adoption, the Company expensed
approximately $741,000, net of an income tax benefit of $468,000,
 of preopening expenses that had been deferred as of
January 31, 1999. Such expense is reflected in the
accompanying consolidated statement of operations as the
cumulative effect of a change in accounting principle.

In June 1998, the Financial Accounting Standards Board
(FASB) issued SFAS No. 133, Accounting for
 Derivative Instruments and Hedging Activities. This
Statement establishes accounting and reporting standards for
derivative instruments and for hedging activities. It requires
companies to recognize all derivatives as either assets or
liabilities in their statement of financial position and measure
those instruments at fair value. In September 1999, the FASB
 issued SFAS No. 137, Accounting for Derivative
Instruments and Hedging Activities-Deferral of the Effective Date
 of FASB Statement No. 133, which delayed the
effective date of SFAS No. 133 to fiscal years beginning
after June 15, 2000. The Company is analyzing the
implementation requirements and currently does not anticipate
there will be a material impact on its financial position or the
results of its operations.

Note 3  Business Acquisitions

Als and Grand Auto Supply

On October 1, 1999, the Company acquired the common stock of
 Als and Grand Auto Supply, Inc. (AGA),
formerly known as PACCAR Automotive, Inc., which operated 194
stores under the trade names of Als Auto Supply and Grand
Auto Supply (collectively, the AGA stores) in
Washington, California, Idaho, Oregon, Nevada and Alaska. The
Company has substantially converted these stores to the
Schucks and Kragen names and store formats and integrated
these stores into the Companys operations.

The Company paid approximately $145.6 million in cash for the
stock of AGA and associated transaction costs. The acquisition
was funded with proceeds from the Senior Credit Facility. In
connection with the acquisition, the Company amended and restated
 the Senior Credit Facility to provide an additional $150.0
million of senior term loan borrowing ability. There are no
contingent payments, options or commitments associated with the
acquisition.

In connection with the integration of the AGA stores, the Company
 will incur one-time transition and integration expenses
estimated to be $28.8 million, consisting primarily of grand
opening advertising, training and re-merchandising costs.
Approximately $21.3 million of such expenses were incurred during
 fiscal 1999 with the balance expected to be incurred during
 the first quarter of fiscal 2000. In addition, the Company
will incur one-time capital expenditures of approximately $5.6
million, consisting primarily of expenditures related to
equipment, store fixtures, signage and the installation of the
Companys store-level information systems in the AGA stores.
 Approximately $2.0 million of such capital expenditures were
incurred during fiscal 1999 with the balance expected to be
incurred during the first quarter of fiscal 2000.

As a result of the AGA acquisition, the Company has analyzed its
store locations in California and the Pacific Northwest. The
Company will close or relocate approximately 39 of the formerly
owned AGA stores (of which 37 were closed as of January 30,
2000) based on several factors including: (1) market
saturation; (2) store profitability; and (3) store size
 and format. Costs associated with these closures consist of
future rents to be paid over the remaining terms of the master
lease agreements for the stores (net of estimated sublease
recoveries). In addition, we finalized a store closure plan for
our own stores that overlap with AGA stores, which resulted in a
pretax charge of approximately $2.5 million during the fourth
quarter of fiscal 1999. The charge consisted of two components:
(1) future rents to be paid over the remaining lease terms
of the master lease agreements for the stores (net of estimated
sublease rentals); and (2) a write-down in the

38



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

carrying amounts of leasehold improvements and other fixed assets
 associated with the affected stores. See Note 12.

The AGA acquisition was accounted for under the purchase method
of accounting. Accordingly, the results of operations of these
stores are included in the consolidated operating results of the
Company from October 1, 1999, the first day of operations
subsequent to the acquisition. The financial statements reflect
the preliminary allocation of the purchase price, based on
estimated fair values at the date of acquisition, pending final
determination of certain acquired balances. Approximately $124.1
million was allocated to inventory, leasehold improvements, fixed
 assets and favorable lease rights. The preliminary allocation
also includes an estimated liability for the cost of closing the
39 acquired stores described above. The excess of the purchase
price over the estimated fair value of the assets acquired
resulted in goodwill of approximately $60.7 million and is being
amortized on a straight-line basis over 30 years.

Automotive Information Systems

On September 7, 1999, the Company acquired all of the common
 stock of Automotive Information Systems, Inc. (AIS).
 AIS, based in St. Paul Minnesota, is a leading provider of
diagnostic vehicle repair information to automotive technicians,
automotive replacement parts manufacturers, automotive test
equipment manufacturers, and the do-it-yourself consumer. The
Company paid approximately $10.3 million in cash for AIS and
funded the acquisition through its Senior Credit Facility. There
are no contingent payments, options or commitments associated
with the acquisition.

The AIS acquisition was accounted for under the purchase method
of accounting. Accordingly, the results of operations are
included in the consolidated operating results of the Company
from September 7, 1999, the first day of operations
subsequent to the acquisition. The financial statements reflect
the preliminary allocation of the purchase price, based on
estimated fair values at the date of acquisition, pending final
determination of certain acquired balances. The excess of the
purchase price over the estimated fair value of the assets
acquired resulted in goodwill of approximately $9.2 million and
is being amortized on a straight-line basis over 20 years.

Big Wheel

On June 30, 1999, the Company acquired substantially all of
the assets of Apsco Products Company dba Big Wheel/ Rossi
(Big Wheel), the leading retailer of auto parts in
the Northern Plains states. Big Wheel operated 86 stores in
Minnesota, North Dakota and Wisconsin along with a distribution
center in Minnesota. The Company has substantially converted
these stores to the Checker name and store format and integrated
these stores into the Companys operations.

The Company paid approximately $62.7 million in cash for
substantially all the assets and assumed certain current
liabilities and indebtedness of Big Wheel. The acquisition was
funded with proceeds from the Senior Credit Facility. In
connection with the acquisition, the Company amended and restated
 the Senior Credit Facility to provide an additional $125.0
million of senior term loan borrowing ability. There are no
contingent payments, options or commitments associated with the
acquisition.

In connection with the integration of the Big Wheel stores, the
Company will incur one-time transition and integration expenses
estimated to be $12.5 million, consisting primarily of grand
opening advertising, training and re-merchandising costs.
Approximately $8.9 million of such expenses were incurred during
fiscal 1999 with the balance expected to be incurred during the
first quarter of fiscal 2000. In addition, the Company will incur
 one-time capital expenditures estimated to be $3.2 million,
consisting primarily of expenditures related to equipment, store
fixtures, signage and the installation of the Companys
store-level information systems in the Big Wheel stores.
Approximately $3.0 million of such capital expenditures were
incurred during fiscal 1999 with the balance expected to be
incurred during the first quarter of fiscal 2000.

39



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

The Big Wheel acquisition was accounted for under the purchase
method of accounting. Accordingly, the results of operations of
these stores are included in the consolidated operating results
of the Company from July 1, 1999, the first day of
operations subsequent to the acquisition. The financial
statements reflect the preliminary allocation of the purchase
price, based on estimated fair values at the date of acquisition,
 pending final determination of certain acquired balances,
principally inventories. Approximately $23.0 million was
allocated to inventory, leasehold improvements, fixed assets and
favorable lease rights. The excess of the purchase price over the
 estimated fair value of the assets acquired resulted in goodwill
 of approximately $56.5 million and is being amortized on a
straight-line basis over 30 years.

M&O Auto Parts

On January 6, 1999, the Company acquired two stores in
Alaska from M&O Auto Parts for $0.9 million. The Company has
converted these stores to the Schucks name and store format
 and integrated these stores into the Companys operations.
No significant transition and integration costs were incurred
relating to this acquisition.

Trak West

On December 8, 1997, the Company acquired a newly formed
subsidiary (Trak West) of Trak Auto Corporation
(Trak Auto). Upon its formation, Trak Auto
contributed to Trak West the fixtures and equipment, merchandise
inventories and store leases of 82 specific store sites in
Southern California, together with the merchandise inventory of
the Ontario, California distribution center operated by Trak
Auto. After this contribution, Trak West had no liabilities and
owned no other assets than those previously described.

The Company acquired Trak West for a total cost of approximately
$34.5 million and financed its acquisition with a $22.0 million
equity investment by affiliates of the Companys existing
stockholders and borrowings under the Senior Credit Facility. In
connection therewith, an affiliate of Investcorp S.A., was paid a
 $1.0 million placement fee. In connection with the negotiation
of the Trak West acquisition, TG Investments, Ltd., an affiliate
of Carmel, was paid a $1.0 million consulting fee.

The Trak West acquisition was accounted for under the purchase
method of accounting. Accordingly, the results of operations of
these stores are included in the consolidated operating results
of the Company from December 9, 1997, the first day of
operations subsequent to the acquisition, and were not material
to the Companys consolidated results of operations for
fiscal 1997. No goodwill was recorded in connection with
this acquisition.

The Company incurred $3.1 million and $3.4 million of one-time
transition and integration expenses during fiscal 1998 and
fiscal 1997, respectively, associated with the Trak West
acquisition. Such expenses included the costs of employee
training, remerchandising and grand opening advertising for the
former Trak West stores.

40



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

The fair value of the assets and liabilities recorded as a result
 of the above described business acquisitions is as follows (in
thousands):

|                              |                           |             |         |         |  |      |        |     |  |   |        |        | 
|----------------------------- | ------------------------- | ----------- | ------- | ------- |  | ---- | ------ | --- |  | - | ------ | ------ | 
|                              |                           |            
|                              |                           | Fiscal Year
|                              |                           |            
|                              |                           | 1999        |         | 1998    |  | 1997
|                              |                           |             |         |         |  |     
|Cash and cash equivalents     |                           | $           | 396     |         |  | $    |       |     |  | $ |       |       
|                             
|                             
|                             
|                             
|Receivables                   |                           |             | 4,450   |         |  |      | 245    |     |  |   |       |       
|                             
|                             
|                             
|                             
|Inventories                   |                           |             | 117,491 |         |  |      | 1,208  |     |  |   | 35,322 |       
|                             
|                             
|                             
|                             
|Assets held for sale          |                           |             | 3,238   |         |  |      | 835    |     |  |   |       |       
|                             
|                             
|                             
|                             
|Property and equipment        |                           |             | 30,049  |         |  |      | 125    |     |  |   |       |       
|                             
|                             
|                             
|                             
|Goodwill                      |                           |             | 126,498 |         |  |      | 193    |     |  |   |       |       
|                             
|                             
|                             
|                             
|Prepaids and other assets     |                           |             | 2,244   |         |  |      | 3      |     |  |   |       |       
|                             
|                             
|                             
|                             
|Deferred income taxes         |                           |             | 3,137   |         |  |      |       |     |  |   |       |       
|                             
|                             
|                             
|                             
|Accounts payable              |                           |             | (35,263 | )       |  |      | (109   | )   |  |   |       |       
|                             
|                             
|                             
|                             
|Accrued liabilities and other |                           |             | (29,465 | )       |  |      | (1,608 | )   |  |   | (193   | )     
|                             
|                             
|                             
|                             
|Closed store reserves         |                           |             | (4,178  | )       |  |      |       |     |  |   | (625   | )     
|                              |                           |             |         |         |  |      |        |     |  |   |        |       
|                              | Total cash purchase price |             | $       | 218,597 |  |      | $      | 892 |  |   | $      | 34,504 | 
|                              |                           |             |         |         |  |      |        |     |  |   |        |       

The following unaudited pro forma financial information presents
the combined historical results of the Company, Big Wheel, AIS
and AGA as if the acquisitions had occurred at the beginning of
the periods presented, after giving effect to certain
adjustments. Pro forma adjustments include the following:
(1) amortization of goodwill; (2) depreciation expense
based on the allocation of purchase price to fixed assets; and
(3) interest expense and amortization of deferred financing
costs associated with the additional borrowings under the Senior
Credit Facility. Although cost savings and other future synergy
benefits of the combined companies are expected, no such benefits
 are reflected in this pro forma financial information.

|                                                                                              |                                                                                               |                                       |           |             |  |   |           |      | 
|--------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------- | ------------------------------------- | --------- | ----------- |  | - | --------- | ---- | 
|                                                                                              |                                                                                               |                                      
|                                                                                              |                                                                                               | Fiscal Year                          
|                                                                                              |                                                                                               |                                      
|                                                                                              |                                                                                               | January 30,                           |           | January 31,
|                                                                                              |                                                                                               | 2000                                  |           | 1999       
|                                                                                              |                                                                                               |                                       |           |            
|                                                                                              |                                                                                               |                                      
|                                                                                              |                                                                                               | (Unaudited)                          
|                                                                                              |                                                                                               | (In thousands, except per share data)
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|Net sales                                                                                     |                                                                                               | $                                     | 1,423,907 |             |  | $ | 1,296,272 |     
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|Net income before extraordinary loss and cumulative effect of
	change in accounting principle |                                                                                               |                                       | 21,020    |             |  |   | 20,133    |     
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|Net income                                                                                    |                                                                                               |                                       | 20,279    |             |  |   | 13,366    |     
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|Basic earnings per share:                                                                     |                                                                                               |                                       |           |             |  |   |           |     
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                              | Net income before extraordinary loss and cumulative effect of
	change in accounting principle |                                       |           | 0.76        |  |   |           | 0.75 | 
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                              | Net income                                                                                    |                                       |           | 0.73        |  |   |           | 0.50 | 
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|Diluted earnings per share:                                                                   |                                                                                               |                                       |           |             |  |   |           |     
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                              | Net income before extraordinary loss and cumulative effect of
	change in accounting principle |                                       |           | 0.73        |  |   |           | 0.73 | 
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                             
|                                                                                              | Net income                                                                                    |                                       |           | 0.71        |  |   |           | 0.48 | 

The pro forma combined results are not necessarily indicative of
the results that would have occurred if the acquisitions and
borrowings had been completed as of the beginning of each of the
periods presented, nor are they necessarily indicative of future
consolidated results. In addition, as described above, the
allocation of the purchase prices for the fiscal 1999
acquisitions are preliminary and are based on estimates. The
final allocation and the resulting amount of goodwill could be
different from the preliminary estimate.

41



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

Note 4  Transactions and Relationships with
Related Parties

In October 1989, the Company entered into a nine year lease
(the Initial Lease) for its corporate headquarters in
 Phoenix, Arizona, with an unaffiliated landlord. During
January 1994, Missouri Falls Holdings Corp., an affiliate of
 Carmel, acquired an interest in the partnership (Missouri
Falls Partners) which acquired the building and assumed the
 lease between the Company and the former landlord. In
October 1996, the Company extended the Initial Lease through
 October 2006. The lease relates to approximately 78,577
square feet and provides for a current base rent of approximately
 $1,490,000 per year. The Company is currently negotiating an
extension for the term of the Initial Lease.

In April 1995, the Company assumed a lease (the
Subsequent Lease) between a former tenant and
Missouri Falls Partners for approximately 11,683 square feet of
additional office space at its corporate headquarters. In
October 1996, the Company extended the Subsequent Lease
through October 2006. At its originally scheduled
termination as of April 1998, rent under the Subsequent
Lease increased to the same per square foot as is charged under
the Initial Lease to a total annual rent of $221,510. The Company
 is currently negotiating an extension of the term of the
Subsequent Lease.

The Company leased approximately 5,754 square feet of additional
space at the above premises for an annual rental of $106,449
under three separate lease documents with expiration dates of
February 2000 and March 2000. The Company has vacated
approximately 2,458 square feet of space for which the lease has
expired. The Company is presently negotiating for an extension of
 the lease on the remaining 3,296 square feet and for a new lease
 of other space in the same premises.

The Company also leases from MFP Holdings, LLC, an affiliate
 of Carmel, a parking lot adjacent to its corporate headquarters
for an annual rental of $62,506 under a separate lease which
expires in October 2006.

From time to time, the Company has entered into sale-leaseback or
 other financing arrangements with related parties.

Beginning in October 1995, the Company entered into a series
 of sale-leaseback transactions with Transatlantic Realty, Inc.
(Realty), another affiliate of Carmel, for various
real property and fixtures. The total funding provided by Realty
in these transactions through January 30, 2000 was
approximately $33.1 million (of which $27.3 million was for real
property and $5.8 million was for fixtures). This amount
represented the Companys cost of such assets. The Company
has replaced approximately $27.3 million of the real property
sale-leasebacks and $5.3 million of the fixture sale-leasebacks
with similar arrangements with unrelated third parties. As of
January 30, 2000, there were approximately $0.5 million of
fixture sale-leasebacks remaining in this facility. The Company
intends to continue to replace such sale-leasebacks and has
agreed to use its best efforts to do so.

Beginning in October 1996, the Company entered into a series
 of sale-leaseback transactions with Transatlantic Leasing, Inc.
(Leasing), another affiliate of Carmel, for certain
real property. The terms of the leases under the facility with
Leasing were set in arms-length negotiations. As of
January 30, 2000, the net funding provided by Leasing in
these transactions was approximately $0.9 million. In
October 1997, the Company established a new sale-leaseback
facility and the Company terminated the facility with Leasing.

The Company believes that the terms of the transactions with
affiliated parties described above in this Note were no less
favorable to it than terms that may have been available from
independent third parties at the time of the applicable
transaction.

In connection with his engagement as Chief Executive Officer, the
 Company loaned Mr. Jenkins $550,000, which he used to
finance the purchase of the new home required as a result of his
relocation. This loan was to mature in 1999 and bear interest at
a rate of 4.545%. This loan was authorized by the Board of
Directors prior to the commencement of Mr. Jenkins
employment. In September 1999, the Company agreed to forgive
$300,000 principal amount of the loan on November 1, 1999
and $250,000 principal amount,

42



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

together with approximately $18,000 accrued and unpaid interest
thereon on February 1, 2000, provided that Mr. Jenkins
remained employed on such date (unless his failure to remain
employed was caused by our termination of his employment).

Note 5  Property and Equipment

Property and equipment is comprised of the following (in
thousands):

|                                                |  |             |          |             |  |                       |         |   |  |  |                             | 
|----------------------------------------------- |  | ----------- | -------- | ----------- |  | --------------------- | ------- | - |  |  | --------------------------- | 
|                                                |  | January 30, |          | January 31, |  |                      
|                                                |  | 2000        |          | 1999        |  | Estimated Useful Life
|                                                |  |             |          |             |  |                      
|Land                                            |  | $           | 554      |             |  | $                     | 817     |   |  |  |                             | 
|                                               
|                                               
|                                               
|                                               
|Buildings                                       |  |             | 766      |             |  |                       | 935     |   |  |  | 25 years                    | 
|                                               
|                                               
|                                               
|                                               
|Leasehold improvements                          |  |             | 84,701   |             |  |                       | 52,453  |   |  |  | 15 years or life of lease   | 
|                                               
|                                               
|                                               
|                                               
|Furniture, fixtures and equipment               |  |             | 113,677  |             |  |                       | 82,484  |   |  |  | 10 years                    | 
|                                               
|                                               
|                                               
|                                               
|Property under capital leases                   |  |             | 67,976   |             |  |                       | 47,566  |   |  |  | 5-15 years or life of lease | 
|                                               
|                                               
|                                               
|                                               
|Purchased software                              |  |             | 11,585   |             |  |                       | 7,685   |   |  |  | 5 years                     | 
|                                                |  |             |          |             |  |                       |         |   |  |  |                             | 
|                                                |  |             | 279,259  |             |  |                       | 191,940 |   |  |  |                             | 
|                                               
|                                               
|                                               
|                                               
|Less: accumulated depreciation and amortization |  |             | (118,698 | )           |  |                       | (89,557 | ) |  |  |                             | 
|                                                |  |             |          |             |  |                       |         |   |  |  |                             | 
|Property and equipment, net                     |  | $           | 160,561  |             |  | $                     | 102,383 |   |  |  |                             | 
|                                                |  |             |          |             |  |                       |         |   |  |  |                             | 

Accumulated amortization of property under capital leases totaled
 $32.3 million and $22.7 million at January 30, 2000 and
January 31, 1999, respectively.

Note 6  Long Term Debt

Senior Credit Facility

Borrowings under the Senior Credit Facility of Auto are as
follows (in thousands):

|                                                                                                                                                                                                                                           |       |             |         |             |  |   |         |         | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----- | ----------- | ------- | ----------- |  | - | ------- | ------- | 
|                                                                                                                                                                                                                                           |       | January 30, |         | January 31,
|                                                                                                                                                                                                                                           |       | 2000        |         | 1999       
|                                                                                                                                                                                                                                           |       |             |         |            
|Term Loan (Tranche B), variable interest rates, average rate
	 7.4% and 7.7% for fiscal 1999 and 1998, respectively,
	semi-annual installments payable each June 30 and
	December  31, final installment is due October 31,
	2003.         |       | $           | 145,320 |             |  | $ | 146,160 |        
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|Term Loan (Tranche B1), variable interest rates, average
	rate 7.8% for fiscal 1999, semi-annual installments payable each
	June 30 and December 31, final installment is due
	October 31, 2003.                                           |       |             | 124,500 |             |  |   |        |        
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|Term Loan (Tranche B2), variable interest rates, average
	rate 8.2% for fiscal 1999, semi-annual installments payable each
	June 30 and December 31, final installment is due
	October 31, 2003.                                           |       |             | 150,000 |             |  |   |        |        
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|Revolving Credit Commitment, variable interest rates, average
	rate 8.1% and 7.4%, for fiscal 1999 and 1998, respectively,
	$125.0 million maximum capacity at January  30, 2000, $33.1
	million undrawn availability at January 30, 2000. |       |             | 89,000  |             |  |   | 79,000  |        
|                                                                                                                                                                                                                                           |       |             |         |             |  |   |         |        
|                                                                                                                                                                                                                                           | Total |             |         | 508,820     |  |   |         | 225,160 | 
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                          
|Less: current maturities                                                                                                                                                                                                                   |       |             | 3,340   |             |  |   | 840     |        
|                                                                                                                                                                                                                                           |       |             |         |             |  |   |         |        
|                                                                                                                                                                                                                                           |       | $           | 505,480 |             |  | $ | 224,320 |        
|                                                                                                                                                                                                                                           |       |             |         |             |  |   |         |        

In connection with the AGA acquisition (see Note 3), the
Company amended and restated its Senior Credit Facility on
September 30, 1999 after previously amending and restating
the Facility to provide

43



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

additional funding for the consummation of the Big Wheel
acquisition in June 1999. As amended and restated, as of
January 30, 2000, the Senior Credit Facility includes the
following significant provisions:



| |   |                                                                                                                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Maximum borrowing capacity of $545.7 million comprised of three
	term loans totaling $420.7 million ($419.8 million of which was
	outstanding as of January 30, 2000) and a revolving credit
	commitment totaling $125.0 million,                                                                                      
|
| |  | Interest and commitment fees at variable rates as provided within
	 a pricing grid that increases as the Companys leverage
	ratio increases with the rates commencing at LIBOR plus 2.5% on
	the term loans, LIBOR plus 2.25% on the revolving credit
	commitment and commitment fees of 0.5% of undrawn availability,
|
| |  | An increase in the covenant restriction on capital expenditures
	to $50.0 million from $40.0 million and certain other adjustments
	 to previously existing financial covenant levels.                                                                                                                                 

Borrowings under the Senior Credit Facility are collateralized by
 a first priority security interest in substantially all of the
personal property of Auto, subject to certain permitted liens.
The Company also issued a guarantee of such borrowings under the
Senior Credit Facility, which guarantee is collateralized by a
pledge by the Company of all issued and outstanding capital stock
 of Auto. In addition, the revolving credit portion allows for
the issuance of letters of credit that reduce revolver
availability. Letters of credit outstanding were $2.9 million and
 $0.6 million at January 30, 2000 and January 31, 1999,
 respectively.

The Senior Credit Facility prohibits, with certain limited
exceptions, the optional or mandatory prepayment or other
defeasance of Autos 11% Senior Subordinated Notes. The
Senior Credit Facility further requires that, under certain
circumstances, Auto make prepayments of the term loan outstanding
 thereunder with (i) 50% of any Excess Cash Flow (as defined
 therein); and (ii) 50% of the Net Proceeds (as defined
therein) from certain offerings of the Companys voting
stock. In addition, a change of control allows the
lenders to accelerate the loans. A change of control occurs under
 any of the following circumstances: (i) anyone, other than
the Initial Shareholders (as defined therein), acquires the power
 to vote at least 30% of the common stock, on a fully diluted
basis (as defined); (ii) certain changes in the composition
of the Board of Directors; and (iii) any sale of the common
stock of Auto.

Commitment fees on available funds under the Revolving Credit
Commitment are payable quarterly in arrears on the average
daily-unused amount of the total commitment. Commitment fees
totaling $103,000 and $295,000 were incurred in fiscal 1999 and
1998, respectively.

The terms of the Senior Credit Facility include restrictions on
investments, capital expenditures, dividends and certain other
payments and require the Company to meet certain financial
covenants. The Company believes it was in compliance with all
such covenants at January 30, 2000.

11% Senior Subordinated Notes Due 2006

On October 30, 1996, Auto issued and sold in a private
placement $125.0 million aggregate principal amount of 11% Senior
 Subordinated Notes due 2006 (the Old 11% Notes)
 pursuant to an indenture, between Auto and The Bank of New York
(as successor to Wells Fargo Bank, N.A.), as Trustee. On
March 13, 1997, Auto offered to exchange up to all
outstanding Old 11% Notes for a like principal amount of its 11%
Series A Senior Subordinated Notes due 2006 (the 11%
Senior Subordinated Notes) issued pursuant to the Indenture
 in a transaction registered under the Securities Act of 1933, as
 amended. Auto consummated the exchange offer on June 18,
1997, with all of the Old 11% Notes being exchanged for the 11%
Senior Subordinated Notes.

In April 1998, 35% of the aggregate principal amount of the
11% Senior Subordinated Notes was redeemed at a redemption price
of 110% of the principal amount thereof, plus accrued and unpaid
interest

44



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

thereon, to the redemption date, with the net proceeds of an
initial public offering of Common Stock. See Note 8.

The indenture potentially restricts Auto from making additional
borrowings under its Revolving Credit Commitment that, when added
 to the aggregate amount of outstanding borrowings under the
Senior Credit Facility (including term loans), exceed $200.0
million. This restriction does not apply if the new borrowings
are of a type specifically permitted by the indenture, or, if
after giving pro forma effect to such new borrowings the ratio of
 Autos consolidated EBITDA to fixed charges (as such terms
are defined in the indenture) exceeds 2.25 to 1. Accordingly, the
 Company has been able to exceed the potential restriction and
does not anticipate that it will limit access to further
borrowings under the Senior Credit Facility.

The indenture also provides that upon a change of
control, as defined therein, each holder of 11% Senior
Subordinated Notes will have the right to require Auto to
repurchase all or any part of such holders notes at a
purchase price in cash equal to 101% of the principal amount plus
 accrued and unpaid interest, if any, to the date of purchase.

The 11% Senior Subordinated Notes bear interest at 11% per year,
payable semiannually in arrears on each May 1 and
November  1, and mature on November 1, 2006. The
11% Senior Subordinated Notes are general, unsecured senior
subordinated obligations. The 11% Senior Subordinated Notes are
required to be guaranteed fully, unconditionally and jointly and
severally by most future United States subsidiaries of Auto, on a
 senior subordinated basis.

On and after November 1, 2001, the 11% Senior Subordinated
Notes will be redeemable, at the option of Auto, in whole or in
part, upon not less than 30 nor more than 60 days
notice, at the redemption prices set forth below (expressed in
percentages of principal amount), plus accrued and unpaid
interest thereon, if any, to the applicable redemption date, if
redeemed during the 12-month period beginning on November 1
of the years indicated below:

|                    |  |            |         |  
|------------------- |  | ---------- | ------- | -
|                    |  | Redemption
|Period              |  | Price     
|                    |  |           
|2001                |  |            | 105.500 | %
|                   
|                   
|                   
|                   
|2002                |  |            | 103.667 | %
|                   
|                   
|                   
|                   
|2003                |  |            | 101.833 | %
|                   
|                   
|                   
|                   
|2004 and thereafter |  |            | 100.000 | %

12% Subordinated Notes Due 2008

On October 30, 1996, the Company issued and sold in a
private placement $10.0 million aggregate principal amount of 12%
 Subordinated Series A Notes due 2008 (the
Series A Notes) pursuant to an Indenture between
 the Company and Transatlantic Finance, Ltd., as Trustee, and
$40.0 million aggregate principal amount of 12% Subordinated
Series B Notes due 2008 (the Series B
Notes, and together with the Series A Notes, the
12% Subordinated Notes) pursuant to an Indenture
between the Company and AIBC, N.V., as Trustee. The terms of the
Series A Notes and the Series B Notes were identical.
These notes were retired, in full, with proceeds of the
Companys March 1998 initial public offering of common
stock. See Note 8.

45



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

Included in other assets are the following charges which have
been deferred and are being amortized over the life of the
related debt instrument (in thousands):

|                              |       |             |        |             |  |   |        |       | 
|----------------------------- | ----- | ----------- | ------ | ----------- |  | - | ------ | ----- | 
|                              |       | January 30, |        | January 31,
|                              |       | 2000        |        | 1999       
|                              |       |             |        |            
|11% Senior Subordinated Notes |       | $           | 5,341  |             |  | $ | 5,341  |      
|                             
|                             
|                             
|                             
|Senior Credit Facility        |       |             | 6,023  |             |  |   | 1,293  |      
|                             
|                             
|                             
|                             
|Accumulated amortization      |       |             | (3,187 | )           |  |   | (1,781 | )    
|                              |       |             |        |             |  |   |        |      
|                              | Total |             | $      | 8,177       |  |   | $      | 4,853 | 
|                              |       |             |        |             |  |   |        |      

At January 30, 2000, the estimated maturities of long term
debt were (in thousands):

|            |  |   |         | 
|----------- |  | - | ------- | 
|Fiscal Year |  |  
|            |  |  
|2000        |  | $ | 3,340   | 
|           
|           
|           
|           
|2001        |  |   | 143,640 | 
|           
|           
|           
|           
|2002        |  |   | 89,920  | 
|           
|           
|           
|           
|2003        |  |   | 271,920 | 
|           
|           
|           
|           
|2004        |  |   |        | 
|           
|           
|           
|           
|Thereafter  |  |   | 81,250  | 
|            |  |   |         | 
|            |  | $ | 590,070 | 
|            |  |   |         | 

As more fully described in Note 8, the Company completed an
initial public offering of its common stock in March 1998.
Net proceeds from the offering were used to reduce outstanding
debt of the Company, as follows (in millions):

|                              |  |   |       | 
|----------------------------- |  | - | ----- | 
|                             
|                             
|                             
|                             
|12% Subordinated Notes        |  | $ | 50.0  | 
|                             
|                             
|                             
|                             
|11% Senior Subordinated Notes |  |   | 43.8  | 
|                             
|                             
|                             
|                             
|Senior Credit Facility        |  |   | 53.8  | 
|                             
|                             
|                             
|                             
|Premiums on retirement        |  |   | 4.9   | 
|                             
|                             
|                             
|                             
|Accrued interest              |  |   | 6.6   | 
|                              |  |   |       | 
|                              |  | $ | 159.1 | 
|                              |  |   |       | 

Upon the consummation of the offering, the Company recorded an
extraordinary loss of approximately $6.8 million, net of taxes.
Such extraordinary loss consisted primarily of the premiums paid
in connection with the redemption of indebtedness and the
write-off of a portion of deferred debt issuance costs.

Note 7  Leases

The Company leases its office and warehouse facilities, all but
four of its retail stores, and a majority of its equipment.
Generally, store leases provide for minimum rentals and the
payment of utilities, maintenance, insurance and taxes. Certain
store leases also provide for contingent rentals based upon a
percentage of sales in excess of a stipulated minimum. The
majority of lease agreements are for base lease periods ranging
from 15 to 20 years, with three to five renewal options of
five years each.

The Company also has access to an off-balance sheet operating
lease facility that is used to finance new store construction.
The facility provides up to $112.2 million of funding for the
acquisition and development of up to 94 new stores through
December 31, 2000. As of January 30, 2000, $4.6 million
 of this $112.2 million leasing facility had been utilized. Under
 a similar agreement that expired on May 31, 1999 with
respect to the addition of new stores, the Company had
approximately $87.6 million committed, with $10.5 million

46



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

remaining to be funded for stores that were previously identified
 for development but not completed by May 31, 1999.

Operating lease rental expense is as follows (in thousands):

|                   |  |             |        |      |  |      |        |   |  |   |        |  
|------------------ |  | ----------- | ------ | ---- |  | ---- | ------ | - |  | - | ------ | -
|                   |  |            
|                   |  | Fiscal Year
|                   |  |            
|                   |  | 1999        |        | 1998 |  | 1997
|                   |  |             |        |      |  |     
|Minimum rentals    |  | $           | 97,748 |      |  | $    | 75,689 |   |  | $ | 57,900 |  
|                  
|                  
|                  
|                  
|Contingent rentals |  |             | 976    |      |  |      | 1,088  |   |  |   | 1,251  |  
|                  
|                  
|                  
|                  
|Sublease rentals   |  |             | (5,395 | )    |  |      | (5,089 | ) |  |   | (4,629 | )
|                   |  |             |        |      |  |      |        |   |  |   |        |  
|                   |  | $           | 93,329 |      |  | $    | 71,688 |   |  | $ | 54,522 |  
|                   |  |             |        |      |  |      |        |   |  |   |        |  

Future minimum lease obligations under non-cancelable leases at
January 30, 2000 are as follows (in thousands):

|                                    |  |           |         |         |  |   |        |  
|----------------------------------- |  | --------- | ------- | ------- |  | - | ------ | -
|                                    |  | Operating |         | Capital
|For Fiscal Years                    |  | Leases    |         | Leases 
|                                    |  |           |         |        
|2000                                |  | $         | 114,199 |         |  | $ | 13,449 |  
|                                   
|                                   
|                                   
|                                   
|2001                                |  |           | 108,292 |         |  |   | 11,112 |  
|                                   
|                                   
|                                   
|                                   
|2002                                |  |           | 101,216 |         |  |   | 9,460  |  
|                                   
|                                   
|                                   
|                                   
|2003                                |  |           | 89,693  |         |  |   | 5,848  |  
|                                   
|                                   
|                                   
|                                   
|2004                                |  |           | 77,110  |         |  |   | 2,729  |  
|                                   
|                                   
|                                   
|                                   
|Thereafter                          |  |           | 423,543 |         |  |   | 3,909  |  
|                                    |  |           |         |         |  |   |        |  
|                                    |  | $         | 914,053 |         |  |   | 46,507 |  
|                                   
|                                   
|                                   
|                                   
|Less: amounts representing interest |  |           |         |         |  |   | (9,444 | )
|                                    |  |           |         |         |  |   |        |  
|Present value of obligations        |  |           |         |         |  |   | 37,063 |  
|                                   
|                                   
|                                   
|                                   
|Less: current portion               |  |           |         |         |  |   | (9,893 | )
|                                    |  |           |         |         |  |   |        |  
|Long term obligation                |  |           |         |         |  | $ | 27,170 |  
|                                    |  |           |         |         |  |   |        |  

The above amounts include future minimum lease obligations under
operating leases with affiliates totaling $13.7 million at
January 30, 2000. Operating lease rental expense under
leases with affiliates totaled $2.4 million for the year ended
January 30, 2000, $3.2 million for the year ended
January 31, 1999, and $2.4 million for the year ended
February 1, 1998.

Future minimum sublease rental income under non-cancelable
subleases for fiscal 2000, 2001, 2002, 2003, 2004 and thereafter
is approximately $5.0 million, $3.8 million, $2.7 million, $2.0
million, $0.9 million and $1.4 million, respectively.

Note 8  Capital Stock and Initial Public Offering

In December 1997, the Company sold 180,600 shares of its
Class B stock to certain executives of the Company. Also in
December 1997, in connection with the acquisition of Trak
West, the Company sold 1,827,788 shares of stock to affiliates of
 the Companys existing stockholders. See Note 9.

On March 17, 1998, the Company completed an initial public
offering (the IPO) of approximately 8.6 million
shares of its common stock, generating proceeds of approximately
$159.1 million, net of offering expenses. The offering proceeds
were used to retire the Companys 12% Subordinated Notes and
 other indebtedness as more fully described in Note 6. Upon
retirement of the 12% Subordinated Notes, all of the outstanding
preferred stock of Auto was cancelled.

47



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

In connection with the IPO, the Companys Board of Directors
 and stockholders approved a 17.105 to 1 stock split effected in
the form of a stock dividend. Accordingly, all share and option
information contained herein has been adjusted to give
retroactive effect to such stock split. In addition, under the
terms of the Companys restated Certificate of Incorporation
 in effect at the time of the IPO, each share of each class of
issued and outstanding capital stock of the Company automatically
 converted to common stock upon the consummation of the IPO on
March 17, 1998.

The Companys capital stock, as adjusted for the stock split
 discussed above, consists of the following:

|                             |  |               |            |                               |  |             |            |             |  |  |            |  |  |  |            | 
|---------------------------- |  | ------------- | ---------- | ----------------------------- |  | ----------- | ---------- | ----------- |  |  | ---------- |  |  |  | ---------- | 
|                             |  |               |            |                              
|                             |  |               |            | Shares Issued and Outstanding
|                             |  |               |            |                              
|                             |  | Shares        |            | January 30,                   |  | January 31, |            | February 1,
|Type of Stock                |  | Authorized(1) |            | 2000                          |  | 1999        |            | 1998       
|                             |  |               |            |                               |  |             |            |            
|Class A, $.01 par value      |  |               |           |                               |  |             |           |             |  |  |           |  |  |  | 7,318,135  | 
|                            
|                            
|                            
|                            
|Class B, $.01 par value      |  |               |           |                               |  |             |           |             |  |  |           |  |  |  | 180,600    | 
|                            
|                            
|                            
|                            
|Class C, $.01 par value      |  |               |           |                               |  |             |           |             |  |  |           |  |  |  | 2,252,061  | 
|                            
|                            
|                            
|                            
|Class D, $.01 par value      |  |               |           |                               |  |             |           |             |  |  |           |  |  |  | 85,525     | 
|                            
|                            
|                            
|                            
|Class E, $.01 par value      |  |               |           |                               |  |             |           |             |  |  |           |  |  |  | 9,277,067  | 
|                            
|                            
|                            
|                            
|Class F, $.01 par value      |  |               |           |                               |  |             |           |             |  |  |           |  |  |  |           | 
|                            
|                            
|                            
|                            
|Common stock, $.01 par value |  |               | 50,000,000 |                               |  |             | 27,834,574 |             |  |  | 27,768,832 |  |  |  |           | 
|                             |  |               |            |                               |  |             |            |             |  |  |            |  |  |  |            | 
|                             |  |               | 50,000,000 |                               |  |             | 27,834,574 |             |  |  | 27,768,832 |  |  |  | 19,113,388 | 
|                             |  |               |            |                               |  |             |            |             |  |  |            |  |  |  |            | 




|    |                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | In March 1998, the Company amended its Certificate of
	Incorporation to eliminate all classes of stock other than common
	 stock and increase the total common stock authorization to 50
	million shares.

Note 9  Employee Benefit Plans

The Company provides various health, welfare and disability
benefits to its full-time employees which are funded primarily by
 Company contributions. The Company does not provide
post-employment or post-retirement health care or life insurance
benefits to its employees.

Retirement Program

The Company sponsors a 401(k) plan which is available to all
employees of the Company who have completed one year of
continuous service. Effective October 1, 1997, the Company
matches from 40% to 60% of employee contributions in 10%
increments, based on years of service with the Company, up to 4%
of the participants base salary. Prior to October 1,
1997, the Company matched 20% of employee contributions, up to 6%
 of the participants base salary, without regard to years
of service. Participant contributions are subject to certain
restrictions as set forth in the Internal Revenue Code. The
Companys matching contributions totaled $1,422,400,
$1,258,500 and $394,500 for fiscal years 1999, 1998 and 1997,
respectively.

1996 Stock Option Plans

On October 30, 1996, the Company awarded options to purchase
 shares of common stock under its Associate Stock Option Plan
(the Associate Plan) and its Executive Stock Option
Plan (the Executive Plan and together with the
Associate Plan, the Plans) in order to provide
incentives to store managers and salaried corporate and warehouse
 employees of the Company. In October 1996 and
February 1997, the Companys Board of Directors
approved the Associate Plan and the Executive Plan, respectively.

The Plans may be administered by a committee of the Board of
Directors of the Company, which would have broad authority in
administering and interpreting the Plans, or, if a committee has
not been appointed, by the entire Board of Directors. The Plans
provide that, at such time as the Company has a class of equity

48



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

securities registered under Section 12 of the Securities
Exchange Act of 1934, as amended (the Exchange Act),
the committee must consist entirely of Non-Employee
Directors (as defined in Rule 16b-3 under the Exchange
 Act). The Compensation Committee has been appointed to
administer the Plans.

Options to purchase up to an aggregate of 1,026,300 shares of
common stock may be granted under the Associate Plan. On
April 30, 1999, the Board of Directors amended and restated
the Executive Plan, increasing the maximum number of shares for
which options may be granted by 60,000 to a total of 744,200
shares of common stock. Options granted under the Plans may be
options intended to qualify as incentive stock options under
Section 422 of the Internal Revenue Code of 1986, as
amended, or options not intended to so qualify. In the event of a
 sale of more than 80% of the outstanding shares of capital stock
 of the Company or 80% of its assets, as defined, all options
under the plan are vested. All options expire on the seventh
anniversary of the date of grant (or, under certain
circumstances, 30 days later).

As a result of the IPO, each option granted under the Plans will
become exercisable upon vesting. Options granted under the
Associate Plan vest in three equal installments on the second,
third and fourth anniversaries of the date of their grant,
assuming the associates employment continues during this
period (Four Year Vesting). Options granted under the
 Executive Plan are subject to the Four Year Vesting as to 84% of
 such options and performance vesting (over the same four years)
as to the remaining 16%. The performance vesting criteria is
based upon achieving specified operating results. Partial vesting
 of options subject to performance vesting occurs if the Company
achieves less than 95% of the specified operating results. Any
portion of options granted under the Executive Plan which are
subject to performance vesting and which do not vest during the
four years will automatically vest 90 days prior to the end of
the options term. If the specified operating results are
exceeded for any year by at least 10%, the executive will receive
 options for up to an additional 5% (20% on a cumulative basis)
of his or her original option grant. Based on 1998 results, an
additional 8,713 options were granted in April 1999. Based
on 1999 results, approximately 15,000 options will be granted in
April 2000.

As of January 30, 2000, the Company has granted options to
purchase 878,455 shares under the Associate Plan and 607,707
shares under the Executive Plan, net of cancellations and
exercises. Except for 96,062 options granted under the Executive
Plan (see Employment Agreements below), the exercise
prices represent the fair market value at the date of grant based
 upon the price paid for such shares and other valuation analyses
 performed by the Company, or actual market prices as determined
by trades reported by the New York Stock Exchange subsequent to
the IPO, as applicable.

1999 Stock Option Plan

On April 30, 1999, the Company adopted the 1999 Employee
Stock Option Plan (the 1999 Plan) in order to
attract, retain and motivate qualified individuals to serve as
employees of the Company.

The 1999 Plan is administered by a committee of the Board of
Directors of the Company, which has broad authority in
administering and interpreting the plan. The 1999 Plan provides
that, at such time as the Company has a class of equity
securities registered under Section 12 of the Securities
Exchange Act of 1934, as amended (the Exchange Act),
the committee must consist entirely of Non-Employee
Directors (as defined in Rule 16b-3 under the Exchange
 Act).

Options to purchase up to an aggregate of 750,000 shares of
common stock may be granted under the 1999 Plan. Options granted
under the 1999 Plan may be options intended to qualify as
incentive stock options under Section 422 of the Internal
Revenue Code of 1986, as amended, or options not intended to so
qualify. In the event of a sale of more than 80% of the
outstanding shares of capital stock of the Company or 80% of its
assets, as defined, all options under the plan are vested. All
options expire on the tenth anniversary of the date of grant (or,
 under certain circumstances, 30 days later).

49



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

As of January 30, 2000, the Company has granted options to
purchase 533,020 shares under the 1999 Plan, net of cancellations
 and exercises. The exercise prices represent the fair market
value at the date of grant based upon actual market prices as
determined by trades reported by the New York Stock Exchange.
Options granted under the 1999 Plan vest and become exercisable
as determined by the Board of Directors.

Directors Stock Plan

Directors who are currently associated with the Investcorp Group
or the Carmel Group do not currently receive any compensation for
 serving as directors. In June 1998, the Companys
Board of Directors adopted a non-employee director compensation
plan, which was approved in June 1999. The plan provides for
 an aggregate of up to 50,000 shares in the form of restricted
stock grants or stock options. The Board of Directors has adopted
 a policy which provides the two non-employee directors who are
not associated with the Investcorp Group or the Carmel Group with
 an annual stipend of $25,000, of which at least $10,000 must be
paid in the form of restricted stock grants. Pursuant to this
Plan, two Directors were granted a total of 1,534 and 1,516
shares of restricted stock during fiscal 1999 and 1998,
respectively.

Employment Agreements

Auto has entered into an employment agreement with its Chairman
pursuant to which he is paid a fixed base salary and eligible for
 a bonus based upon earnings per share. The agreement does not
contain a stated termination date, but rather is terminable at
will by either party. If Auto were to terminate the employment of
 the Chairman without cause, or if he terminates his employment
for good reason, Auto has agreed to pay to the Chairman his base
salary and performance bonus for a period of 24 months. The
Chairman also received a loan of $550,000 from the Company,
bearing interest at 4.545%. In consideration of the
chairmans efforts regarding the Companys acquisitions
 (see Note 3), $300,000 was forgiven during the fourth
quarter of fiscal 1999, with the remaining balance to be forgiven
 in the first quarter of fiscal 2000. Auto had entered into an
employment agreement with its President pursuant to which he was
paid a base salary and a bonus based upon earnings per share. The
 agreement was terminated effective April 1, 2000 in
connection with the Presidents retirement from day-to-day
operations.

In connection with the commencement of his employment, the
Company agreed to pay the Chairman $1.0 million which, in turn,
was used by the Chairman to purchase 83,079 shares of common
stock from a member of the Investcorp Group, reflecting a share
value of $12.04, the fair market value at the date of the
agreement, based on the price paid for such shares in the 1996
Recapitalization. The Company also loaned the Chairman
approximately $440,000 to pay the income tax consequences of the
award. The loan bears interest at the rate applicable to
borrowings under the Revolving Credit Commitment. This loan was
paid in full in December 1998.

In connection with the execution of his employment agreement, the
 Companys Chairman received an option for 401,967 shares of
 common stock, exercisable at $12.04 per share. As of
January 30, 2000, this option had vested to the extent of
200,982 shares. As a result of vesting acceleration triggered by
the IPO, this option will generally vest and become exercisable
in March 2000, subject to earlier vesting based upon the
achievement of certain EBITDA targets and the occurrence of other
 specified events. In connection with the Trak West acquisition,
the Companys Chairman received an option for 39,940 shares
of common stock, exercisable at $12.04 per share, effective as of
 February 1, 1998. This option will vest and become
exercisable in four equal annual installments beginning in
April 1999. In connection with the issuance of these
options, the Company will recognize a charge to earnings of
approximately $0.2 million over the vesting period for the
difference between the exercise price and the fair market value
of the common stock at the date of grant. In connection with the
IPO, the Companys Chairman received an option for 216,635
shares of common stock, exercisable at $20.00 per share, the fair
 market value at the date of grant based on the IPO. This option
will vest and become exercisable in three equal annual
installments beginning in April 2000.

50



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

In connection with the execution of his employment agreement, the
 Companys President received an option for 299,337 shares
of common stock, exercisable at $12.04 per share. This option has
 both vested and become exercisable to the extent of 171,048
shares. As a result of vesting acceleration triggered by the IPO,
 the remainder of this option vested and became exercisable in
March 2000.

Management Stock Purchase Agreements and Loans
Plans

In December 1997, the Company entered into stock purchase
agreements with certain executives of the Company. Under the
terms of the agreements, the Company agreed to issue a total of
180,600 shares of its common stock at a price of $12.04 per
share, the same price paid in the 1996 Recapitalization. In
addition, the Company granted certain executives non-qualified
options to purchase 96,058 shares of its common stock, also at a
price of $12.04 per share. The options contain similar terms and
vesting provisions as existing options under the Companys
Executive Stock Option Plan. In connection with the issuance of
these shares, the Company recognized a charge to earnings of $0.9
 million in the fourth quarter of fiscal 1997 for the difference
between the issuance price and the fair market value of the stock
 at the date of sale. In addition, in the fourth quarter of
fiscal 1997, the Company recorded deferred compensation of
approximately $0.5 million to reflect the difference between the
exercise price and the fair market value of stock associated with
 the options granted to certain executives. The deferred
compensation will produce a charge to earnings over the vesting
period of the options.

Of the total consideration paid to the Company of $2.2 million in
 connection with the purchase of the Companys common stock
by certain executives, approximately $1.0 million was loaned by
the Company to certain executives to purchase 84,542 of the
shares (the Stock Loans). The Stock Loans are
collateralized by the stock under pledge agreements, provide full
 recourse to the executive, bear interest at the average rate
paid by the Company under the revolving portion of its Senior
Credit Facility, and mature in December 2003.

Options Activity

Activity in all of the Companys stock option plans is
summarized as follows:

|                         |                                   |           |           |                |   |            |       |       |  |  |   |       | 
|------------------------ | --------------------------------- | --------- | --------- | -------------- | - | ---------- | ----- | ----- |  |  | - | ----- | 
|                         |                                   |           |           | Weighted       |   | Weighted  
|                         |                                   | Number of |           | Average        |   | Average   
|                         |                                   | Shares    |           | Exercise Price |   | Fair Value
|                         |                                   |           |           |                |   |           
|Balance at Feb. 2, 1997  |                                   |           | 1,540,461 |                |   | $          | 12.04 |       |  |  |   |      
|                        
|                        
|                        
|                        
|                         | Granted at market price           |           |           | 425,707        |   |            |       | 17.05 |  |  | $ | 3.48  | 
|                        
|                        
|                        
|                        
|                         | Granted at less than market price |           |           | 136,002        |   |            |       | 12.04 |  |  |   | 10.44 | 
|                        
|                        
|                        
|                        
|                         | Exercised                         |           |           |               |   |            |       |      |  |  |   |       | 
|                        
|                        
|                        
|                        
|                         | Cancelled                         |           |           | (79,518        | ) |            |       | 12.04 |  |  |   |       | 
|                         |                                   |           |           |                |   |            |       |       |  |  |   |      
|Balance at Feb. 1, 1998  |                                   |           | 2,022,652 |                |   |            | 13.19 |       |  |  |   |      
|                        
|                        
|                        
|                        
|                         | Granted at market price           |           |           | 267,784        |   |            |       | 25.03 |  |  |   | 12.20 | 
|                        
|                        
|                        
|                        
|                         | Exercised                         |           |           | (30,444        | ) |            |       | 12.04 |  |  |   |       | 
|                        
|                        
|                        
|                        
|                         | Cancelled                         |           |           | (114,790       | ) |            |       | 13.66 |  |  |   |       | 
|                         |                                   |           |           |                |   |            |       |       |  |  |   |      
|Balance at Jan. 31, 1999 |                                   |           | 2,145,202 |                |   |            | 14.56 |       |  |  |   |      
|                        
|                        
|                        
|                        
|                         | Granted at market price           |           |           | 1,040,302      |   |            |       | 24.32 |  |  | $ | 13.22 | 
|                        
|                        
|                        
|                        
|                         | Exercised                         |           |           | (65,742        | ) |            |       | 12.04 |  |  |   |       | 
|                        
|                        
|                        
|                        
|                         | Cancelled                         |           |           | (142,701       | ) |            |       | 19.71 |  |  |   |       | 
|                         |                                   |           |           |                |   |            |       |       |  |  |   |      
|Balance at Jan. 30, 2000 |                                   |           | 2,977,061 |                |   | $          | 17.78 |       |  |  |   |      
|                         |                                   |           |           |                |   |            |       |       |  |  |   |      

51



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

The following table summarizes information about the
Companys stock options at January 30, 2000:

|                |  |                     |           |                     |  |                  |      |             |  |                   |       |  |  |  |         |  |  |   |       | 
|--------------- |  | ------------------- | --------- | ------------------- |  | ---------------- | ---- | ----------- |  | ----------------- | ----- |  |  |  | ------- |  |  | - | ----- | 
|                |  |                     |           |                    
|                |  | Options Outstanding |           | Options Exercisable
|                |  |                     |           |                    
|                |  |                     |           | Weighted Average    |  |                  |      |             |  | Weighted         
|Range of        |  | Number              |           | Remaining           |  | Weighted Average |      | Number      |  | Average          
|Exercise Prices |  | Outstanding         |           | Contractual Life    |  | Exercise Price   |      | Exercisable |  | Exercisable Price
|                |  |                     |           |                     |  |                  |      |             |  |                  
|$12.04          |  |                     | 1,492,690 |                     |  |                  | 4.06 |             |  | $                 | 12.04 |  |  |  | 462,954 |  |  | $ | 12.04 | 
|$13.09  $20.00 |  |                     | 703,320   |                     |  |                  | 6.27 |             |  |                   | 17.20 |  |  |  | 15,936  |  |  |   | 20.00 | 
|$20.13  $32.09 |  |                     | 345,280   |                     |  |                  | 6.06 |             |  |                   | 25.78 |  |  |  |        |  |  |   |      | 
|$32.25  $36.53 |  |                     | 435,771   |                     |  |                  | 6.09 |             |  |                   | 32.68 |  |  |  | 122,148 |  |  |   | 32.25 | 
|                |  |                     |           |                     |  |                  |      |             |  |                   |       |  |  |  |         |  |  |   |       | 
|$12.04  $36.53 |  |                     | 2,977,061 |                     |  |                  | 5.11 |             |  | $                 | 17.78 |  |  |  | 601,038 |  |  | $ | 16.36 | 

The Company has adopted the disclosure-only provisions of SFAS
No. 123, Accounting for Stock-Based
Compensation. Had compensation costs for the Companys
 stock option plans been determined based on the fair value at
the grant date for awards, consistent with the provisions of SFAS
 No. 123, net income (loss) and diluted earnings
(loss) per share would have been changed to the pro forma
amounts indicated below (in thousands except per share data):

|                                   |             |             |   |        |  |      |   |        |  |  |   |        |  
|---------------------------------- | ----------- | ----------- | - | ------ |  | ---- | - | ------ |  |  | - | ------ | -
|                                   |             |            
|                                   |             | Fiscal Year
|                                   |             |            
|                                   |             | 1999        |   | 1998   |  | 1997
|                                   |             |             |   |        |  |     
|Net income (loss):                 |             |             |   |        |  |      |   |        |  |  |   |       
|                                  
|                                  
|                                  
|                                  
|                                   | As reported |             | $ | 27,371 |  |      | $ | 20,718 |  |  | $ | (771   | )
|                                  
|                                  
|                                  
|                                  
|                                   | Pro forma   |             |   | 24,471 |  |      |   | 19,621 |  |  |   | (1,230 | )
|                                  
|                                  
|                                  
|                                  
|Diluted earnings (loss) per share: |             |             |   |        |  |      |   |        |  |  |   |       
|                                  
|                                  
|                                  
|                                  
|                                   | As reported |             | $ | 0.96   |  |      | $ | 0.75   |  |  | $ | (0.04  | )
|                                  
|                                  
|                                  
|                                  
|                                   | Pro forma   |             |   | 0.85   |  |      |   | 0.71   |  |  |   | (0.07  | )

The fair value of each option grant is estimated on the date of
grant using the Black Scholes method of option pricing and is
based upon the following assumptions:

|                         |  |             |            |      |  |      |            |   |  |  |         |  
|------------------------ |  | ----------- | ---------- | ---- |  | ---- | ---------- | - |  |  | ------- | -
|                         |  |            
|                         |  | Fiscal Year
|                         |  |            
|                         |  | 1999        |            | 1998 |  | 1997
|                         |  |             |            |      |  |     
|Dividend yield           |  |             | 0          | %    |  |      | 0          | % |  |  | 0       | %
|                        
|                        
|                        
|                        
|Risk free interest rate  |  |             | 4.75- 5.94 | %    |  |      | 4.25- 5.63 | % |  |  | 5.95    | %
|                        
|                        
|                        
|                        
|Expected life of options |  |             | 6 years    |      |  |      | 6 years    |   |  |  | 4 years |  
|                        
|                        
|                        
|                        
|Expected volatility      |  |             | 49         | %    |  |      | 43         | % |  |  |        |  

Note 10  Supplemental Schedule of Cash Flows

Interest paid during fiscal 1999, 1998 and 1997 amounted to $36.7
 million, $29.4 million and $36.2 million, respectively. Income
taxes paid during fiscal 1999 amounted to $6.8 million. No income
 taxes were paid in fiscal 1998 and 1997.

The Company acquired certain fixtures and other equipment under
capital lease arrangements totaling approximately $17.2 million,
$10.5 million and $9.7 million in fiscal 1999, 1998 and 1997,
respectively.

52



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

Note 11  Income Taxes

The provision for income taxes (exclusive of extraordinary items)
 is comprised of the following (in thousands):

|          |         |             |        |        |        |      |        |        |        |  |       |       |       | 
|--------- | ------- | ----------- | ------ | ------ | ------ | ---- | ------ | ------ | ------ |  | ----- | ----- | ----- | 
|          |         |            
|          |         | Fiscal Year
|          |         |            
|          |         | 1999        |        | 1998   |        | 1997
|          |         |             |        |        |        |     
|Current:  |         |             |        |        |        |      |        |        |        |  |       |      
|         
|         
|         
|         
|          | Federal |             | $      | 450    |        |      | $      | 225    |        |  | $     |      |      
|         
|         
|         
|         
|          | State   |             |        | 387    |        |      |        | 130    |        |  |       |      |      
|          |         |             |        |        |        |      |        |        |        |  |       |      
|          |         |             | 837    |        |        |      | 355    |        |        |  |      |      
|          |         |             |        |        |        |      |        |        |        |  |       |      
|Deferred: |         |             |        |        |        |      |        |        |        |  |       |      
|         
|         
|         
|         
|          | Federal |             |        | 13,707 |        |      |        | 12,614 |        |  |       | 1,260 |      
|         
|         
|         
|         
|          | State   |             |        | 2,892  |        |      |        | 2,777  |        |  |       | 297   |      
|          |         |             |        |        |        |      |        |        |        |  |       |      
|          |         |             | 16,599 |        |        |      | 15,391 |        |        |  | 1,557 |      
|          |         |             |        |        |        |      |        |        |        |  |       |      
|          |         | Total       |        | $      | 17,436 |      |        | $      | 15,746 |  |       | $     | 1,557 | 
|          |         |             |        |        |        |      |        |        |        |  |       |      

Included in fiscal 1999 results of operations is $468,000 of tax
benefit relating to the cumulative effect of change in accounting
 principle (see Note 2).

The following table summarizes the differences between the
Companys provision for income taxes and the expected
provision, exclusive of extraordinary items (in thousands):

|                                                                                                        |  |             |        |      |  |      |        |   |  |   |       |  
|------------------------------------------------------------------------------------------------------- |  | ----------- | ------ | ---- |  | ---- | ------ | - |  | - | ----- | -
|                                                                                                        |  |            
|                                                                                                        |  | Fiscal Year
|                                                                                                        |  |            
|                                                                                                        |  | 1999        |        | 1998 |  | 1997
|                                                                                                        |  |             |        |      |  |     
|Income before income taxes, extraordinary loss and cumulative
	effect of change in accounting principle |  | $           | 45,548 |      |  | $    | 43,231 |   |  | $ | 3,801 |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Federal income tax rate                                                                                 |  |             | 35     | %    |  |      | 35     | % |  |   | 34    | %
|                                                                                                        |  |             |        |      |  |      |        |   |  |   |       |  
|Expected provision for income taxes                                                                     |  |             | 15,942 |      |  |      | 15,131 |   |  |   | 1,292 |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|State taxes, net of federal benefit                                                                     |  |             | 2,131  |      |  |      | 2,718  |   |  |   | 196   |  
|                                                                                                       
|                                                                                                       
|                                                                                                       
|                                                                                                       
|Tax credits and other                                                                                   |  |             | (637   | )    |  |      | (2,103 | ) |  |   | 69    |  
|                                                                                                        |  |             |        |      |  |      |        |   |  |   |       |  
|Actual provision for income taxes                                                                       |  | $           | 17,436 |      |  | $    | 15,746 |   |  | $ | 1,557 |  
|                                                                                                        |  |             |        |      |  |      |        |   |  |   |       |  

The current and non-current deferred tax assets and liabilities
consist of the following (in thousands):

|                           |                                    |                                 |   |             |        |  |   |       |        | 
|-------------------------- | ---------------------------------- | ------------------------------- | - | ----------- | ------ |  | - | ----- | ------ | 
|                           |                                    | January 30,                     |   | January 31,
|                           |                                    | 2000                            |   | 1999       
|                           |                                    |                                 |   |            
|Gross deferred tax assets: |                                    |                                 |   |             |        |  |   |      
|                          
|                          
|                          
|                          
|                           | Store closing costs                |                                 | $ | 1,905       |        |  | $ | 2,112 |       
|                          
|                          
|                          
|                          
|                           | Accrued employee benefits          |                                 |   | 5,949       |        |  |   | 3,990 |       
|                          
|                          
|                          
|                          
|                           | Capital lease expenditures         |                                 |   | 555         |        |  |   | 765   |       
|                          
|                          
|                          
|                          
|                           | Internally developed software      |                                 |   | 933         |        |  |   | 1,865 |       
|                          
|                          
|                          
|                          
|                           | Preopening costs                   |                                 |   | 573         |        |  |   | 239   |       
|                          
|                          
|                          
|                          
|                           | Provision for site selection costs |                                 |   |            |        |  |   | 1,189 |       
|                          
|                          
|                          
|                          
|                           | Provision for bad debts            |                                 |   | 862         |        |  |   | 675   |       
|                          
|                          
|                          
|                          
|                           | Tax loss carryforwards             |                                 |   | 2,242       |        |  |   | 5,487 |       
|                          
|                          
|                          
|                          
|                           | Other                              |                                 |   | 2,727       |        |  |   | 973   |       
|                           |                                    |                                 |   |             |        |  |   |      
|                           |                                    | Total gross deferred tax assets |   |             | 15,746 |  |   |       | 17,295 | 
|                           |                                    |                                 |   |             |        |  |   |      

53



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

|                                   |                                    |                                      |        |             |        |   |       |       |        | 
|---------------------------------- | ---------------------------------- | ------------------------------------ | ------ | ----------- | ------ | - | ----- | ----- | ------ | 
|                                   |                                    | January 30,                          |        | January 31,
|                                   |                                    | 2000                                 |        | 1999       
|                                   |                                    |                                      |        |            
|Gross deferred tax liabilities:    |                                    |                                      |        |             |        |   |       |      
|                                  
|                                  
|                                  
|                                  
|                                   | Inventory                          |                                      |        | 14,931      |        |   |       | 8,948 |       
|                                  
|                                  
|                                  
|                                  
|                                   | Depreciation                       |                                      |        | 4,478       |        |   |       | 1,698 |       
|                                  
|                                  
|                                  
|                                  
|                                   | Provision for site selection costs |                                      |        | 2,052       |        |   |       |      |       
|                                  
|                                  
|                                  
|                                  
|                                   | Other                              |                                      |        | 1,503       |        |   |       |      |       
|                                   |                                    |                                      |        |             |        |   |       |      
|                                   |                                    | Total gross deferred tax liabilities |        |             | 22,964 |   |       |       | 10,646 | 
|                                   |                                    |                                      |        |             |        |   |       |      
|Net deferred tax asset (liability) |                                    | $                                    | (7,218 | )           |        | $ | 6,649 |      
|                                   |                                    |                                      |        |             |        |   |       |      

The net deferred tax assets (liabilities) are reflected in
the accompanying balance sheets as follows:

|                                                   |  |             |        |             |  |   |        |  
|-------------------------------------------------- |  | ----------- | ------ | ----------- |  | - | ------ | -
|                                                   |  | January 30, |        | January 31,
|                                                   |  | 2000        |        | 1999       
|                                                   |  |             |        |            
|Current deferred tax liabilities, net              |  | $           | (1,417 | )           |  | $ | (4,046 | )
|                                                  
|                                                  
|                                                  
|                                                  
|Non-current deferred tax assets (liabilities), net |  |             | (5,801 | )           |  |   | 10,695 |  
|                                                   |  |             |        |             |  |   |        |  
|Net deferred tax asset (liability)                 |  | $           | (7,218 | )           |  | $ | 6,649  |  
|                                                   |  |             |        |             |  |   |        |  

The Company has recorded deferred tax assets of approximately
$2.2 million as of January 30, 2000 reflecting the benefit
of federal tax loss carryforwards totaling $6.4 million which
begin to expire in 2013. Realization is dependent on generating
sufficient taxable income prior to expiration of the loss
carryforwards. Utilization of certain of the net operating loss
carryforwards may be limited under Section 382 of the
Internal Revenue Code. Although realization is not assured,
management believes it is more likely than not that all the
deferred tax assets will be realized. Accordingly, the Company
believes that no valuation allowance is required for deferred tax
 assets in excess of deferred tax liabilities. The amount of the
deferred tax assets considered realizable, however, could be
reduced in the near term if estimates of future taxable income
during the carryforward period are reduced.

Note 12  Store Closing Costs

The Company provides an allowance for estimated costs and losses
to be incurred in connection with store closures. For stores to
be closed, such costs are recognized when a store is specifically
 identified, costs can be estimated and closure is planned to be
completed within the next twelve months (prior to
January 31, 1999, eighteen months). For stores to be
relocated, such costs are recognized when an agreement for the
new location has been reached with a landlord and site plans meet
 preliminary municipal approvals. The allowance for store closing
 costs is included in accrued expenses in the accompanying
financial statements, and consists primarily of future rents to
be paid over the remaining terms of the master lease agreement
for stores, net of estimated sub-lease recoveries. Future rents
will be incurred through the expiration of the non-cancelable
leases, the longest of which run through June 2014.

54



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

Activity in the provision for store closings and the related
store closing costs for the three years ended January 30,
2000, is as follows (in thousands):

|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |        |       | 
|-------------------------------- | ------------------------------- | ------------------------------------- | ------ | ----- | ----- | ---- | ------ | ----- | --- | - | ------ | ------ | ----- | 
|                                 |                                 |                                      
|                                 |                                 | Fiscal Year                          
|                                 |                                 |                                      
|                                 |                                 | 1999                                  |        | 1998  |       | 1997
|                                 |                                 |                                       |        |       |       |     
|Balance, beginning of year       |                                 | $                                     | 2,670  |       |       | $    | 8,379  |       |     | $ | 10,794 |       
|                                
|                                
|                                
|                                
|Store closing costs:             |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                
|                                
|                                
|                                
|                                 | Store closing costs, gross      |                                       |        | 5,252 |       |      |        | 1,925 |     |   |        | 3,103  |      
|                                
|                                
|                                
|                                
|                                 | Adjustments to prior year plans |                                       |        | (387  | )     |      |        | (620  | )   |   |        | (1,431 | )    
|                                
|                                
|                                
|                                
|                                 | Revisions in estimates          |                                       |        | 35    |       |      |        | (970  | )   |   |        | (32    | )    
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                 |                                 | Store closing costs, net              |        |       | 4,900 |      |        |       | 335 |   |        |        | 1,640 | 
|                                
|                                
|                                
|                                
|Purchase accounting adjustments: |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                
|                                
|                                
|                                
|                                 | Trak West                       |                                       |        |      |       |      |        |      |     |   |        | 625    |      
|                                
|                                
|                                
|                                
|                                 | Big Wheel                       |                                       |        | 98    |       |      |        |      |     |   |        |       |      
|                                
|                                
|                                
|                                
|                                 | Als and Grand Auto Supply      |                                       |        | 4,080 |       |      |        |      |     |   |        |       |      
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|                                 |                                 | Total purchase accounting adjustments |        |       | 4,178 |      |        |       |    |   |        |        | 625   | 
|                                
|                                
|                                
|                                
|Payments                         |                                 |                                       | (6,946 | )     |       |      | (6,044 | )     |     |   | (4,680 | )     
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       
|Balance, end of year             |                                 | $                                     | 4,802  |       |       | $    | 2,670  |       |     | $ | 8,379  |       
|                                 |                                 |                                       |        |       |       |      |        |       |     |   |        |       

During the period that they remain open for business, the rent
and other operating expenses for the stores to be closed continue
 to be reflected in the Companys normal operating expenses.
 Included in store closing costs for fiscal 1999 is a charge of
$2.5 million for store closing costs that were incurred due to
overlap of certain CSK stores with more favorably sized or
situated stores acquired from Als and Grand Auto Supply.

As part of the purchase price allocation for the Trak West, Big
Wheel and AGA stores (see Note 3), the Company recorded an
allowance for the costs of closing or relocating certain stores.

Adjustments to prior plans relate to costs for store closures
that were accrued in prior years but withdrawn from the
Companys store closure plan in the year of adjustment. Such
 withdrawals are due to subsequent improvements in the underlying
 economics of the stores performance or (in the case of
store relocation) because the Company was unable to secure a
previously identified site upon acceptable lease terms. The
Company had significant adjustments to prior year plans in 1997
and 1998 because of changes resulting from higher than expected
improvements in its gross profit margins in 1997-1998 and changes
 resulting from the Trak West Acquisition (see Note 3) and
the IPO (see Note 8). Further significant changes to the
strategic plan are not considered likely. All relocations and
store closings are anticipated to be completed within twelve
months of accrual and only after costs can be estimated.

Other cost revisions are comprised of changes in expected future
rental costs for vacant or sub-leased store locations, which are
due largely to early terminations of lease agreements.

On a store count basis, activity and the remaining number of
stores to be closed are summarized as follows:

|            |  |                               |    |              |  |            |    |               |  |            |     |   |  |  |     |   |  |  |    | 
|----------- |  | ----------------------------- | -- | ------------ |  | ---------- | -- | ------------- |  | ---------- | --- | - |  |  | --- | - |  |  | -- | 
|            |  |                               |    |             
|            |  | Number of Stores to be Closed |    |             
|            |  |                               |    |             
|            |  | Beginning                     |    |              |  | Plan       |    |               |  | Balance to
|Fiscal Year |  | Balance                       |    | Stores Added |  | Amendments |    | Stores Closed |  | be Closed 
|            |  |                               |    |              |  |            |    |               |  |           
|1997        |  |                               | 56 |              |  |            | 36 |               |  |            | (15 | ) |  |  | (29 | ) |  |  | 48 | 
|           
|           
|           
|           
|1998        |  |                               | 48 |              |  |            | 24 |               |  |            | (10 | ) |  |  | (33 | ) |  |  | 29 | 
|           
|           
|           
|           
|1999        |  |                               | 29 |              |  |            | 87 |               |  |            | (11 | ) |  |  | (77 | ) |  |  | 28 | 

55



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

At January 30, 2000, there were 28 stores remaining to
be closed under the Companys store closing plans, comprised
 of the following:

|            |  |              |    |            |  |               |     |            |  |  |     |   |  |  |    | 
|----------- |  | ------------ | -- | ---------- |  | ------------- | --- | ---------- |  |  | --- | - |  |  | -- | 
|            |  | Stores in    |    | Plan       |  |               |     | Balance to
|Fiscal Year |  | Closing Plan |    | Amendments |  | Stores Closed |     | be Closed 
|            |  |              |    |            |  |               |     |           
|1996        |  |              | 91 |            |  |               | (17 | )          |  |  | (73 | ) |  |  | 1  | 
|           
|           
|           
|           
|1997        |  |              | 36 |            |  |               | (13 | )          |  |  | (20 | ) |  |  | 3  | 
|           
|           
|           
|           
|1998        |  |              | 24 |            |  |               | (5  | )          |  |  | (19 | ) |  |  |   | 
|           
|           
|           
|           
|1999        |  |              | 87 |            |  |               | (1  | )          |  |  | (62 | ) |  |  | 24 | 
|            |  |              |    |            |  |               |     |            |  |  |     |   |  |  |    | 
|            |  |              |    |            |  |               |     |            |  |  |     |   |  |  | 28 | 

Note 13  Legal Matters

On May 4, 1998, a lawsuit was filed against the Company in
the Superior Court in San Diego, California. The case was brought
 by two former store managers and a former senior assistant
manager. It purports to be a class action for all present and
former California store managers and senior assistant managers
and seeks overtime pay for a period beginning in May 1995 as well
 as injunctive relief requiring overtime pay in the future. The
Company has also been served with two other lawsuits purporting
to be class actions filed in California state courts in Orange
and Fresno Counties by thirteen other former and current
employees. These lawsuits include similar claims to the San Diego
 lawsuit, except that they also include claims for unfair
business practices which seek overtime from October 1994. The
Orange County lawsuit initially included claims for punitive
damages and unlawful conversion, but the Court subsequently
dismissed both of these claims.

The three cases have been coordinated before one
judge in San Diego County. Discovery has been conducted by the
parties. On January 19, 2000, as amended on January 27,
 2000, the judge issued an order allowing the coordinated
lawsuits to proceed as class actions, with class periods of May
1994 through January 2000 for store managers and October 1994
through July 1997 for senior assistant managers. The Company
filed a Petition for Writ of Mandate seeking appellate review of
the foregoing order which was not successful. On March 23,
2000, the Company filed a Petition for Review by the California
Supreme Court to have the trial courts order reversed.

Although the Company cannot estimate the potential loss or range
of loss at this time, if these cases are permitted to proceed as
class actions and are decided against it, the Company believes
that the aggregate potential exposure could be material to
results of operations or cash flows for the year in which the
cases are ultimately decided. However, the Company does not
believe that such an adverse outcome, if it were to happen, would
 materially affect its financial position, or its operations or
cash flows in subsequent periods. Although at this stage in the
litigation it is difficult to predict its outcome with any
certainty, the Company believes that there are meritorious
defenses to these cases and intends to defend them vigorously.

The Company was served on March 8, 2000 with a complaint
filed in Federal Court in the Eastern District of New York by the
 Coalition for a Level Playing Field, L.L.C. and
179 individual auto parts dealers alleging that the Company
and seven other auto parts dealers (AutoZone, Inc., Wal-Mart
Stores, Inc., Advance Stores Company, Inc., Discount Auto, Inc.,
The Pep Boys  Manny, Moe and Jack, Inc., OReilly
 Automotive, Inc., and Keystone Automotive Operations, Inc.)
violated the Robinson-Patman Act. Only 14 of the individual
plaintiffs asserted claims against the Company, and three of
those have voluntarily dismissed their claims without prejudice.
The complaint alleges that the Company and other defendants
knowingly either induced or received discriminatory prices from
large suppliers, allegedly in violation of Section 2(a)
and 2(f) of the Robinson-Patman Act, as well as receiving
compensation from large suppliers for services not performed for
those suppliers, allegedly in violation of Section 2(c) of
the Robinson-Patman Act. The complaint seeks injunctive relief
against all defendants and seeks treble damages on behalf of the
individual

56



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

auto parts dealers who are plaintiffs, plus attorneys fees.
 The complaint alleges that the estimated average damage amount
per plaintiff is $1,000,000 (and more for those plaintiffs that
are wholesale distributors and not simply jobbers) before
trebling. The Company believes the suit is without merit and
plans to vigorously defend it.

The Company currently and from time to time is involved in other
litigation incidental to the conduct of its business. The damages
 claimed in some of this litigation are substantial. Although the
 amount of liability that may result from these matters cannot be
 ascertained, the Company does not currently believe that, in the
 aggregate, they will result in liabilities material to its
consolidated financial condition, results of operations or cash
flows.

Note 14  Fair Value of Financial Instruments

The estimated fair values of the Companys financial
instruments, which are determined by reference to quoted market
prices, where available, or are based upon comparisons to similar
 instruments of comparable maturities, are as follows (in
thousands):

|                                                |  |                  |         |                  |  |          |         |            |  |   |         |  |  |   |         | 
|----------------------------------------------- |  | ---------------- | ------- | ---------------- |  | -------- | ------- | ---------- |  | - | ------- |  |  | - | ------- | 
|                                                |  |                  |         |                 
|                                                |  | January 30, 2000 |         | January 31, 1999
|                                                |  |                  |         |                 
|                                                |  | Carrying         |         | Estimated        |  | Carrying |         | Estimated 
|                                                |  | Amount           |         | Fair Value       |  | Amount   |         | Fair Value
|                                                |  |                  |         |                  |  |          |         |           
|Cash and cash equivalents                       |  | $                | 11,762  |                  |  | $        | 11,762  |            |  | $ | 7,490   |  |  | $ | 7,490   | 
|                                               
|                                               
|                                               
|                                               
|Receivables                                     |  |                  | 69,129  |                  |  |          | 69,129  |            |  |   | 58,867  |  |  |   | 58,867  | 
|                                               
|                                               
|                                               
|                                               
|Amounts due under Senior Credit Facility        |  |                  | 508,820 |                  |  |          | 508,820 |            |  |   | 225,160 |  |  |   | 225,160 | 
|                                               
|                                               
|                                               
|                                               
|Obligations under 11% Senior Subordinated Notes |  |                  | 81,250  |                  |  |          | 82,367  |            |  |   | 81,250  |  |  |   | 85,313  | 

Note 15  Subsequent Events

During March 2000, the Company entered into a definitive
agreement to acquire substantially all of the assets of All-Car
Distributors, Inc. (AllCar), an operator of 22 stores
 in Wisconsin and Michigan. Under the terms of the agreement, the
 Company will pay approximately $865,000 in cash for the assets
of AllCar and will assume vendor accounts payable and certain
indebtedness and accrued expenses. The closing, which is subject
to the satisfaction of certain conditions, is expected to occur
on April 27, 2000. The acquisition of the 22 AllCar stores
gives the Company an immediate presence of scale in a
strategically important market adjacent to our current
operations. The acquired stores will be serviced out of its
Minneapolis Distribution Center and will be converted to the
Checker Auto Parts name.

During January 2000, the Company entered into a definitive
agreement with Advance Auto Parts and Sequoia Capital to form a
new joint venture, PartsAmerica.com, which is expected to become
one of the largest automotive parts and accessories e-commerce
destinations in the $90 billion automotive parts and accessories
market. PartsAmerica.com will operate independently from its
partners and will utilize both CSKs and Advances
existing logistic systems to suport its web-based operations.
PartsAmerica.com will offer both retail and commercial customers
the widest available selection of automotive parts and delivery
options, including same-day delivery, local in-store pickup, and
overnight shipment. In addition, because of 50-state coverage,
customers will be able to return or exchange merchandise at their
 local CSK or Advance Auto Parts store. The Company has
contributed the use of the e-commerce capabilities of its
existing web site and certain other assets to the joint venture.
The Company is a party to a service agreement with
PartsAmerica.com that governs the terms of our sale of
merchandise to PartsAmerica.com and certain other services that
the Company is to provide to the joint venture. PartsAmerica.com
is expected to commence operations in July 2000.

57



---



CSK AUTO CORPORATION AND SUBSIDIARY


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

Item 9.  Changes in and Disagreements with
Accountants on Accounting and Financial Disclosure

None

PART III

Item 10.  Directors and Executive Officers
of the Registrant

The information required by this item with respect to Directors
is incorporated by reference from the information under the
caption Election of Directors contained in our
definitive proxy statement in connection with the solicitation of
 proxies for our 2000 Annual Meeting of Stockholders to be held
on June 20, 2000 (the Proxy Statement).

The required information concerning our Executive Officers is
also contained in the Proxy Statement.

Item 11.  Executive Compensation

The information required by this item is incorporated by
reference from the information under the caption Executive
Compensation contained in the Proxy Statement.

Item 12.  Security Ownership of Certain
Beneficial Owners and Management

The information required by this item is incorporated by
reference from the information under the caption Security
Ownership of Certain Beneficial Owners and Management
contained in the Proxy Statement.

Item 13.  Certain Relationships and Related
Transactions

The information required by this item is incorporated by
reference from the information under the caption Certain
Relationships and Related Transactions contained in the
Proxy Statement.

PART IV

Item 14.  Exhibits, Financial Statement
Schedules and Reports on Form 8-K

(a)(1)  The following consolidated financial statements of
CSK Auto Corporation are included in Item 8. of this Report
on Form 10-K.

Report of Independent Accountants

Consolidated Balance Sheets  January 30, 2000
and January 31, 1999

Consolidated Statements of Operations  Fiscal Years
Ended January 30, 2000, January 31, 1999 and
February 1, 1998

Consolidated Statements of Stockholders Equity 
 Fiscal Years Ended January 30, 2000, January 31, 1999
and February 1, 1998

Consolidated Statements of Cash Flows  Fiscal Years
Ended January 30, 2000, January 31, 1999 and
February 1, 1998

Notes to Consolidated Financial Statements

(a)(2)  The following financial statement schedule of CSK
Auto Corporation for the three years ended January 30, 2000
is included in this Report on Form 10-K, as required by
Item 14(d): Schedule II  Valuation and
Qualifying Accounts and report of independent accountants
thereon. Other schedules have been omitted because information is
 not required or otherwise is included in the Notes to the
Consolidated Financial Statements.

58



---



(a)(3) Exhibits:

|        |         |                         |  |                                                                                                                                                                                                                                                                                                                                                                          
|------- | ------- | ----------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |         |                        
|Number  |         | Description of Exhibits
|        |         |                        
|        | 3.01    |                         |  | Restated Certificate of Incorporation of the Company,
	incorporated herein by reference to Exhibit 3.01 of our
	Annual Report on Form 10-K, filed on May 4, 1998 (File
	No.  001-13927).                                                                                                                                                                                 
|        | 3.02    |                         |  | Certificate of Correction to the Restated Certificate of
	Incorporation of the Company, incorporated herein by reference to
	 Exhibit 3.02 of our Annual Report on Form  10-K, filed
	 on May 4, 1998 (File No. 001-13927).                                                                                                                                              
|        | 3.03    |                         |  | Amended and Restated By-laws of the Company, incorporated herein
	by reference to Exhibit 3.03 of our Annual Report on
	Form 10-K, filed on April 28, 1999 (File
	No. 001-13927).                                                                                                                                                                                        
|        | 4.01    |                         |  | Third Amended and Restated Credit Agreement, dated as of
	September 30, 1999, among Auto, The Chase Manhattan Bank, DLJ
	Capital Funding, Inc., Lehman Commercial Paper Inc., and the
	Lenders from time to time parties thereto, incorporated herein by
	 reference to Exhibit 4.01 of our Current Report on
	Form 8-K, filed on October 15, 1999 (File No.
	001-13927).
|        | 4.02    |                         |  | Indenture, dated as of October 30, 1996, by and among CSK
	Auto, Inc. (Auto), Kragen Auto Supply Co.,
	Schucks Distribution Co. and The Bank of New York (as
	successor to Wells Fargo Bank, N.A.), as Trustee, including form
	of Note, incorporated herein by reference to CSK Auto,
	Inc.s Registration Statement on Form S-4 (File No.
	333-22511).              
|        | 4.03    |                         |  | Form of Common Stock certificate, incorporated herein by
	reference to our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                                                                                                                                     
|        | 10.01.1 |                         |  | Amended and Restated Employment Agreement, dated as of June 
	 12, 1998, between Auto and James Bazlen, incorporated herein by
	reference to our Quarterly Report on Form 10-Q, filed on
	September 11, 1998 (File No. 001-13927).                                                                                                                                       
|        | 10.01.2 |                         |  | Letter Agreement, dated March 30, 2000, between Auto and
	James Bazlen.                                                                                                                                                                                                                                                                                                  
|        | 10.02   |                         |  | Stock Option Agreement, dated November 1, 1996, between the
	Company and James Bazlen, incorporated herein by reference to our
	 Registration Statement on Form S-1 (File No. 
	333-67231).                                                                                                                                                                              
|        | 10.03.1 |                         |  | Amended and Restated Employment Agreement, dated as of June 
	 12, 1998, between Auto and Maynard Jenkins, incorporated herein
	by reference to our Quarterly Report on Form 10-Q, filed on
	September 11, 1998 (File No. 001-13927).                                                                                                                                    
|        | 10.03.2 |                         |  | Amendment to Employment Agreement, dated as of September 
	24, 1999, between Auto and Maynard Jenkins.                                                                                                                                                                                                                                                                   
|        | 10.04   |                         |  | Promissory Note of Maynard Jenkins, dated December 21, 1997,
	 incorporated herein by reference to our Registration Statement
	on Form S-1 (File No. 333-43211).                                                                                                                                                                                                         
|        | 10.05   |                         |  | Stock Pledge Agreement between the Company and Maynard Jenkins,
	dated December 21, 1997, incorporated herein by reference to
	 our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                                                                            
|        | 10.06.1 |                         |  | Stock Acquisition Agreement, dated January 27, 1997, among
	Maynard Jenkins, Auto and the Company, incorporated herein by
	reference to our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                                                                    
|        | 10.06.2 |                         |  | First Amendment to Stock Acquisition Agreement, incorporated
	herein by reference to our Annual Report on Form 10-K, filed
	 on April 28, 1999 (File No. 001-13927).                                                                                                                                                                                                     
|        | 10.07   |                         |  | Stock Option Agreement, dated January 27, 1997, between the
	Company and Maynard Jenkins, incorporated herein by reference to
	our Registration Statement on Form S-1 (File
	No. 333-67231).                                                                                                                                                                             

59



---



|        |         |                         |  |                                                                                                                                                                                                                                                                                                                      
|------- | ------- | ----------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |         |                        
|Number  |         | Description of Exhibits
|        |         |                        
|        | 10.08   |                         |  | Stock Option Agreement, dated February 1, 1998, between the
	Company and Maynard Jenkins, incorporated herein by reference to
	our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                         
|        | 10.09   |                         |  | Stock Option Agreement, dated March 9, 1998, between the
	Company and Maynard Jenkins, incorporated herein by reference to
	our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                            
|        | 10.10   |                         |  | Restated 1996 Associate Stock Option Plan, incorporated herein by
	 reference to our Registration Statement on Form  S-1 (File
	No. 333-67231).                                                                                                                                                                      
|        | 10.11   |                         |  | Restated 1996 Executive Stock Option Plan (Amended and Restated
	June 8, 1999), incorporated herein by reference to our definitive
	 Proxy Statement, filed on May 11, 1999 (File
	No. 001-13927).                                                                                                                   
|        | 10.12   |                         |  | 1999 Employee Stock Option Plan, incorporated by reference to our
	 definitive Proxy Statement, filed on May 11, 1999 (File No.
	 001-13927).                                                                                                                                                                        
|        | 10.13   |                         |  | CSK Auto Corporation Directors Stock Plan, incorporated herein by
	 reference to our Quarterly Report on Form 10-Q, filed on
	September 11, 1998 (File No. 001-13927).                                                                                                                                               
|        | 10.14   |                         |  | Form of Restricted Stock Agreement pursuant to the CSK Auto
	Corporation Directors Stock Plan.                                                                                                                                                                                                                       
|        | 10.15   |                         |  | CSK Auto Corporation 2000 Senior Executive Stock Loan Plan.                                                                                                                                                                                                                                                          
|        | 10.16   |                         |  | Amended and Restated Lease, dated October 23, 1989 (the
	Missouri Falls Lease), between Auto and Missouri
	Falls Associates Limited Partnership, incorporated herein by
	reference to CSK Auto, Inc.s Registration Statement on
	Form S-4 (File No. 333-22511).                                                   
|        | 10.17   |                         |  | First Amendment to the Missouri Falls Lease, dated November 
	 22, 1991, between Auto and Missouri Falls Associates Limited
	Partnership, incorporated herein by reference to CSK Auto,
	Inc.s Registration Statement on Form S-4 (File
	No.  333-22511).                                                           
|        | 10.18   |                         |  | Amendment to Leases, dated as of October 30, 1996, by and
	between Missouri Falls Associates Limited Partnership and Auto,
	incorporated herein by reference to CSK Auto, Inc.s
	Registration Statement on Form S-4 (File
	No. 333-22511).                                                                          
|        | 10.19.1 |                         |  | Stockholders Agreement, dated October 30, 1996, by and
	 among the Initial Investcorp Group, Cantrade Trust Company
	Limited in its capacity as trustee of The Carmel Trust, the
	Company and Auto, incorporated herein by reference to CSK Auto,
	Inc.s Registration Statement on Form S-4 (File
	No.  333-22511).
|        | 10.19.2 |                         |  | Form of Supplemental Stockholders Agreement Signature Page,
	 incorporated herein by reference to our Registration Statement
	on Form S-1 (File No. 333-43211).                                                                                                                                                     
|        | 10.19.3 |                         |  | Amendment to the Stockholders Agreement, dated
	June 12, 1998, incorporated herein by reference to our
	Registration Statement on Form S-1 (File
	No. 333-67231).                                                                                                                                                   
|        | 10.19.4 |                         |  | Letter Agreement re: Stockholders Agreement, incorporated
	herein by reference to our Annual Report on Form 10-K, filed
	 on April 28, 1999 (File No. 001-13927).                                                                                                                                                   
|        | 10.20   |                         |  | CSK Auto Corporation 1997 Senior Executive Stock Loan Plan,
	incorporated herein by reference to our Registration Statement on
	 Form S-1 (File No. 333-43211).                                                                                                                                                      
|        | 10.21   |                         |  | Form of Stock Purchase Agreement pursuant to the CSK Auto
	Corporation 1997 Stock Loan Plan, incorporated herein by
	reference to our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                      
|        | 21.01   |                         |  | Subsidiaries of the Company.                                                                                                                                                                                                                                                                                         
|        | 23.01   |                         |  | Consent of PricewaterhouseCoopers LLP.                                                                                                                                                                                                                                                                               
|        | 27.01   |                         |  | Financial Data Schedule.                                                                                                                                                                                                                                                                                             

60



---



(b)  Reports on Form 8-K:

(1)  On December 15, 1999, we filed a current report on
 Form 8-K/ A to amend our October 15, 1999
Form 8-K. (The Form 8-K had been filed to report, under
 Item 2 thereof, the acquisition of all the issued and
outstanding stock of Als and Grand Auto Supply, Inc. (f/k/a
 PACCAR Automotive, Inc.) from PACCAR, Inc. We did not include
any financial statements in such Form 8-K.) The
Form 8-K/ A included, in Item 7 thereof, the following
financial statements:

a. Audited Financial Statements of Paccar Automotive, Inc.



| |      |                                                                                     
| | ---- | ------------------------------------------------------------------------------------
| | i.   | Report of Independent Auditors                                                      
|
| | ii.  | Consolidated Balance Sheet as of December 25, 1998                                  
|
| | iii. | Consolidated Statement of Income for the year ended December 25,
	1998              
|
| | iv.  | Consolidated Statement of Stockholders Equity for the year
	ended December 25, 1998
|
| | v.   | Consolidated Statement of Cash Flows for the year ended
	December 25, 1998          
|
| | vi.  | Notes to Consolidated Financial Statements                                          

b. Unaudited Interim Financial Statements of Paccar Automotive,
Inc.



| |      |                                                                                                                                    
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------
| | i.   | Condensed Consolidated Balance Sheet as of September 25,
	1999 (unaudited)                                                         
|
| | ii.  | Condensed Consolidated Statement of Income (Loss) for the nine
	months ended September 25, 1999 and September 25, 1998
	(unaudited)
|
| | iii. | Condensed Consolidated Statement of Cash Flows for the nine
	months ended September 25, 1999 and September 25, 1998
	(unaudited)   
|
| | iv.  | Notes to Condensed Consolidated Financial Statements (unaudited)                                                                   

c. Pro Forma Financial Statements of CSK Auto Corporation and
Subsidiary



| |      |                                                                                                          
| | ---- | ---------------------------------------------------------------------------------------------------------
| | i.   | Pro Forma Condensed Consolidated Income Statement for the year
	ended January  31, 1999 (unaudited)      
|
| | ii.  | Pro Forma Condensed Consolidated Income Statement for the nine
	months ended October 31, 1999 (unaudited)
|
| | iii. | Notes to Pro Forma Condensed Consolidated Financial Statements
	(unaudited)                              

(2)  Report on Form 8-K dated January 31, 2000
discussing the status of the Companys legal proceedings.

61



---



REPORT OF INDEPENDENT ACCOUNTANTS ON

FINANCIAL STATEMENT SCHEDULE


To the Board of Directors of CSK Auto Corporation

Our audits of the consolidated financial statements referred to
in our report dated March 21, 2000, appearing in this Annual
 Report on Form 10-K of CSK Auto Corporation and its
subsidiary also included an audit of the financial statement
schedule listed in Item 14(a)(2) of this Form 10-K. In
our opinion, this financial statement schedule presents fairly,
in all material respects, the information set forth therein when
read in conjunction with the related consolidated financial
statements.

PRICEWATERHOUSECOOPERS LLP

Phoenix, Arizona



62



---



CSK AUTO CORPORATION AND SUBSIDIARY

SCHEDULE II  VALUATION AND QUALIFYING ACCOUNTS

For the Fiscal Years 1999, 1998 and 1997


|                         |                             |                |  |            |  |             |  |            |  |            |  |       |  |  |  |        |   |  |  |       | 
|------------------------ | --------------------------- | -------------- |  | ---------- |  | ----------- |  | ---------- |  | ---------- |  | ----- |  |  |  | ------ | - |  |  | ----- | 
|                         |                             | Balance at     |  | Charged to |  | Purchase    |  |            |  | Balance at
|                         |                             | Beginning of   |  | Costs and  |  | Accounting  |  |            |  | End of    
|Description              |                             | Period         |  | Expenses   |  | Adjustments |  | Deductions |  | Period    
|                         |                             |                |  |            |  |             |  |            |  |           
|                         |                             |               
|                         |                             | (in thousands)
|                        
|                        
|                        
|                        
|Allowance for Bad Debts: |                             |                |  |            |  |             |  |            |  |            |  |       |  |  |  |        |   |  |  |      
|                        
|                        
|                        
|                        
|                         | Year Ended February 1, 1998 |                |  | 1,768      |  |             |  | 2,033      |  |            |  |      |  |  |  | (1,398 | ) |  |  | 2,403 | 
|                        
|                        
|                        
|                        
|                         | Year Ended January 31, 1999 |                |  | 2,403      |  |             |  | 1,591      |  |            |  |      |  |  |  | (2,291 | ) |  |  | 1,703 | 
|                        
|                        
|                        
|                        
|                         | Year Ended January 30, 2000 |                |  | 1,703      |  |             |  | 3,910      |  |            |  | 1,178 |  |  |  | (3,497 | ) |  |  | 3,294 | 

63



---



SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended, the registrant has
duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on this 27th day of April
 2000.



| |                     
| | --------------------
| | CSK AUTO CORPORATION



| |     |                    
| | --- | -------------------
| | By: | /s/ MAYNARD JENKINS

| |                                     
| | ------------------------------------
| |                                     
| | Maynard Jenkins                     
| | Chairman and Chief Executive Officer

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended, this report has been
 signed by the following persons on behalf of the registrant, and
 in the capacities indicated, on this 27th day of April 2000.

|                                                 |  |                                                                                 
|------------------------------------------------ |  | --------------------------------------------------------------------------------
|/s/ MAYNARD JENKINSMaynard Jenkins               |  | Chairman of the Board and Chief Executive
	Officer (Principal Executive Officer)
|/s/ JOHN F. ANTIOCOJohn F. Antioco               |  | Director                                                                        
|/s/ JAMES BAZLENJames Bazlen                     |  | Director                                                                        
|/s/ JAMES O. EGANJames O. Egan                   |  | Director                                                                        
|/s/ MORTON GODLASMorton Godlas                   |  | Director                                                                        
|/s/ CHARLES K. MARQUISCharles K. Marquis         |  | Director                                                                        
|/s/ CHRISTOPHER J. OBRIENChristopher J. OBrien |  | Director                                                                        
|/s/ CHARLES J. PHILIPPINCharles J. Philippin     |  | Director                                                                        
|/s/ ROBERT SMITHRobert Smith                     |  | Director                                                                        
|/s/ CHRISTOPHER J. STADLERChristopher J. Stadler |  | Director                                                                        
|/s/ JULES TRUMPJules Trump                       |  | Director                                                                        
|/s/ EDDIE TRUMPEddie Trump                       |  | Director                                                                        

64



---



|                               |  |                                                                                                                             
|------------------------------ |  | ----------------------------------------------------------------------------------------------------------------------------
|/s/ SAVIO W. TUNGSavio W. Tung |  | Director                                                                                                                    
|/s/ DON W. WATSONDon W. Watson |  | Senior Vice President, Chief Financial Officer and Treasurer
	(Principal Financial Officer and Principal Accounting Officer)

65



---



INDEX TO EXHIBITS

|        |         |                         |  |                                                                                                                                                                                                                                                                                                                                                                          
|------- | ------- | ----------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |         |                        
|Number  |         | Description of Exhibits
|        |         |                        
|        | 3.01    |                         |  | Restated Certificate of Incorporation of the Company,
	incorporated herein by reference to Exhibit 3.01 of our
	Annual Report on Form 10-K, filed on May 4, 1998 (File
	No.  001-13927).                                                                                                                                                                                 
|        | 3.02    |                         |  | Certificate of Correction to the Restated Certificate of
	Incorporation of the Company, incorporated herein by reference to
	 Exhibit 3.02 of our Annual Report on Form  10-K, filed
	 on May 4, 1998 (File No. 001-13927).                                                                                                                                              
|        | 3.03    |                         |  | Amended and Restated By-laws of the Company, incorporated herein
	by reference to Exhibit 3.03 of our Annual Report on
	Form 10-K, filed on April 28, 1999 (File
	No. 001-13927).                                                                                                                                                                                        
|        | 4.01    |                         |  | Third Amended and Restated Credit Agreement, dated as of
	September 30, 1999, among Auto, The Chase Manhattan Bank, DLJ
	Capital Funding, Inc., Lehman Commercial Paper Inc., and the
	Lenders from time to time parties thereto, incorporated herein by
	 reference to Exhibit 4.01 of our Current Report on
	Form 8-K, filed on October 15, 1999 (File No.
	001-13927).
|        | 4.02    |                         |  | Indenture, dated as of October 30, 1996, by and among CSK
	Auto, Inc. (Auto), Kragen Auto Supply Co.,
	Schucks Distribution Co. and The Bank of New York (as
	successor to Wells Fargo Bank, N.A.), as Trustee, including form
	of Note, incorporated herein by reference to CSK Auto,
	Inc.s Registration Statement on Form S-4 (File No.
	333-22511).              
|        | 4.03    |                         |  | Form of Common Stock certificate, incorporated herein by
	reference to our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                                                                                                                                     
|        | 10.01.1 |                         |  | Amended and Restated Employment Agreement, dated as of June 
	 12, 1998, between Auto and James Bazlen, incorporated herein by
	reference to our Quarterly Report on Form 10-Q, filed on
	September 11, 1998 (File No. 001-13927).                                                                                                                                       
|        | 10.01.2 |                         |  | Letter Agreement, dated March 30, 2000, between Auto and
	James Bazlen.                                                                                                                                                                                                                                                                                                  
|        | 10.02   |                         |  | Stock Option Agreement, dated November 1, 1996, between the
	Company and James Bazlen, incorporated herein by reference to our
	 Registration Statement on Form S-1 (File No. 
	333-67231).                                                                                                                                                                              
|        | 10.03.1 |                         |  | Amended and Restated Employment Agreement, dated as of June 
	 12, 1998, between Auto and Maynard Jenkins, incorporated herein
	by reference to our Quarterly Report on Form 10-Q, filed on
	September 11, 1998 (File No. 001-13927).                                                                                                                                    
|        | 10.03.2 |                         |  | Amendment to Employment Agreement, dated as of September 
	24, 1999, between Auto and Maynard Jenkins.                                                                                                                                                                                                                                                                   
|        | 10.04   |                         |  | Promissory Note of Maynard Jenkins, dated December 21, 1997,
	 incorporated herein by reference to our Registration Statement
	on Form S-1 (File No. 333-43211).                                                                                                                                                                                                         
|        | 10.05   |                         |  | Stock Pledge Agreement between the Company and Maynard Jenkins,
	dated December 21, 1997, incorporated herein by reference to
	 our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                                                                            
|        | 10.06.1 |                         |  | Stock Acquisition Agreement, dated January 27, 1997, among
	Maynard Jenkins, Auto and the Company, incorporated herein by
	reference to our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                                                                    
|        | 10.06.2 |                         |  | First Amendment to Stock Acquisition Agreement, incorporated
	herein by reference to our Annual Report on Form 10-K, filed
	 on April 28, 1999 (File No. 001-13927).                                                                                                                                                                                                     
|        | 10.07   |                         |  | Stock Option Agreement, dated January 27, 1997, between the
	Company and Maynard Jenkins, incorporated herein by reference to
	our Registration Statement on Form S-1 (File
	No. 333-67231).                                                                                                                                                                             
|        | 10.08   |                         |  | Stock Option Agreement, dated February 1, 1998, between the
	Company and Maynard Jenkins, incorporated herein by reference to
	our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                                                                             



---



|        |         |                         |  |                                                                                                                                                                                                                                                                                                                      
|------- | ------- | ----------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |         |                        
|Number  |         | Description of Exhibits
|        |         |                        
|        | 10.09   |                         |  | Stock Option Agreement, dated March 9, 1998, between the
	Company and Maynard Jenkins, incorporated herein by reference to
	our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                            
|        | 10.10   |                         |  | Restated 1996 Associate Stock Option Plan, incorporated herein by
	 reference to our Registration Statement on Form  S-1 (File
	No. 333-67231).                                                                                                                                                                      
|        | 10.11   |                         |  | Restated 1996 Executive Stock Option Plan (Amended and Restated
	June 8, 1999), incorporated herein by reference to our definitive
	 Proxy Statement, filed on May 11, 1999 (File
	No. 001-13927).                                                                                                                   
|        | 10.12   |                         |  | 1999 Employee Stock Option Plan, incorporated by reference to our
	 definitive Proxy Statement, filed on May 11, 1999 (File No.
	 001-13927).                                                                                                                                                                        
|        | 10.13   |                         |  | CSK Auto Corporation Directors Stock Plan, incorporated herein by
	 reference to our Quarterly Report on Form 10-Q, filed on
	September 11, 1998 (File No. 001-13927).                                                                                                                                               
|        | 10.14   |                         |  | Form of Restricted Stock Agreement pursuant to the CSK Auto
	Corporation Directors Stock Plan.                                                                                                                                                                                                                       
|        | 10.15   |                         |  | CSK Auto Corporation 2000 Senior Executive Stock Loan Plan.                                                                                                                                                                                                                                                          
|        | 10.16   |                         |  | Amended and Restated Lease, dated October 23, 1989 (the
	Missouri Falls Lease), between Auto and Missouri
	Falls Associates Limited Partnership, incorporated herein by
	reference to CSK Auto, Inc.s Registration Statement on
	Form S-4 (File No. 333-22511).                                                   
|        | 10.17   |                         |  | First Amendment to the Missouri Falls Lease, dated November 
	 22, 1991, between Auto and Missouri Falls Associates Limited
	Partnership, incorporated herein by reference to CSK Auto,
	Inc.s Registration Statement on Form S-4 (File
	No.  333-22511).                                                           
|        | 10.18   |                         |  | Amendment to Leases, dated as of October 30, 1996, by and
	between Missouri Falls Associates Limited Partnership and Auto,
	incorporated herein by reference to CSK Auto, Inc.s
	Registration Statement on Form S-4 (File
	No. 333-22511).                                                                          
|        | 10.19.1 |                         |  | Stockholders Agreement, dated October 30, 1996, by and
	 among the Initial Investcorp Group, Cantrade Trust Company
	Limited in its capacity as trustee of The Carmel Trust, the
	Company and Auto, incorporated herein by reference to CSK Auto,
	Inc.s Registration Statement on Form S-4 (File
	No.  333-22511).
|        | 10.19.2 |                         |  | Form of Supplemental Stockholders Agreement Signature Page,
	 incorporated herein by reference to our Registration Statement
	on Form S-1 (File No. 333-43211).                                                                                                                                                     
|        | 10.19.3 |                         |  | Amendment to the Stockholders Agreement, dated
	June 12, 1998, incorporated herein by reference to our
	Registration Statement on Form S-1 (File
	No. 333-67231).                                                                                                                                                   
|        | 10.19.4 |                         |  | Letter Agreement re: Stockholders Agreement, incorporated
	herein by reference to our Annual Report on Form 10-K, filed
	 on April 28, 1999 (File No. 001-13927).                                                                                                                                                   
|        | 10.20   |                         |  | CSK Auto Corporation 1997 Senior Executive Stock Loan Plan,
	incorporated herein by reference to our Registration Statement on
	 Form S-1 (File No. 333-43211).                                                                                                                                                      
|        | 10.21   |                         |  | Form of Stock Purchase Agreement pursuant to the CSK Auto
	Corporation 1997 Stock Loan Plan, incorporated herein by
	reference to our Registration Statement on Form S-1 (File
	No. 333-43211).                                                                                                                      
|        | 21.01   |                         |  | Subsidiaries of the Company.                                                                                                                                                                                                                                                                                         
|        | 23.01   |                         |  | Consent of PricewaterhouseCoopers LLP.                                                                                                                                                                                                                                                                               
|        | 27.01   |                         |  | Financial Data Schedule.