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increased our store count at year-end from 814 to 2,484;

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achieved positive comparable store sales growth in every quarter, averaging 6.9% annually;

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increased our net sales at a compound annual growth rate of 38.8%, from $848.1 million to $3.1 billion (pro forma for the Discount acquisition); and

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increased our EBITDA, as adjusted, at a compound annual growth rate of 39.9%, from $68.4 million to $261.9 million (pro forma for the Discount acquisition).

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(1)	Our fiscal year consists of 52 or 53 weeks ending on the Saturday nearest to December 31. All fiscal years presented are 52 weeks.

(2)

Gross profit for 2001 and pro forma 2001 exclude a non-recurring charge associated with our supply chain initiatives that occurred during the twelve weeks ended December 29, 2001. The effects of these items are included in operating income, income (loss) before extraordinary item and cumulative effect of a change in accounting principle and net income (loss).

(3)	Selling, general and administrative expenses exclude certain non-recurring charges. The effects of these items are included in operating income, income (loss) before extraordinary item and cumulative effect of a change in accounting principle and net income (loss).

(4)	Income (loss) before extraordinary item and cumulative effect of a change in accounting principle per basic and diluted shares presented for pro forma 2001 represents income (loss) from continuing operations.

(5)

EBITDA, as adjusted, represents operating income plus depreciation and amortization, non-cash and other employee compensation expenses, merger and integration expense and certain non-recurring charges and gains included in operating income. EBITDA, as adjusted, is not intended to represent cash flow from operations as defined by generally accepted accounting principles, or GAAP, and should not be considered as a substitute for net income as an indicator of operating performance or as an alternative to cash flow (as measured by GAAP) as a measure of liquidity. We have included EBITDA, as adjusted, herein because our management believes this information is useful to investors, as such measure provides additional information with respect to our ability to meet our future debt service, capital expenditures and working capital requirements and, in addition, certain covenants in our indentures and credit facility are based upon an EBITDA calculation. Our method for calculating EBITDA, as adjusted, may differ from similarly titled measures reported by other companies. Our management believes certain non-recurring charges and gains, non-cash and other employee compensation expenses, and merger and integration expenses should be eliminated from the EBITDA calculation to evaluate our operating performance, and we have done so in our calculation of EBITDA, as adjusted.

(6)	Capital expenditures for 2001 and pro forma 2001 exclude $34.1 million for our November 2001 purchase of Discount’s Gallman, Mississippi distribution facility from the lessor in connection with the Discount acquisition.

(7)

Comparable store sales growth is calculated based on the change in net sales starting once a store has been opened for thirteen complete accounting periods (each period represents four weeks). Relocations are included in comparable store sales from the original date of opening. Additionally, the Parts America stores acquired in the Western merger and subsequently converted to Advance Auto Parts stores are included in the comparable store sales calculation after thirteen complete accounting periods following their physical conversion. Stores acquired in the Carport acquisition are included in the comparable store sales calculation following thirteen complete accounting periods after their system conversion to the Advance Auto Parts store system. Stores acquired in the Discount acquisition will be included in the comparable stores sales calculation beginning in December 2002, which is thirteen complete accounting periods after the acquisition date of November 28, 2001. Comparable store sales do not include sales from our Western Auto stores.

(8)	Net new stores represents new stores opened and acquired less stores closed. The negative net new stores count for the forty weeks ended October 5, 2002 is a result of closing 130 Discount and Advance stores in our existing markets as part of the integration of Discount.

(9)	Average net retail sales per store is based on the average of beginning and ending number of stores for the respective period. The fiscal 2001 amounts were calculated giving effect to the Discount retail net sales and number of stores for the period from December 2, 2001 through December 29, 2001.

(10)

Average net retail sales per square foot is based on the average of beginning and ending total store square footage for the respective period. The fiscal 2001 amounts were calculated giving effect to the Discount retail net sales and square footage for the period from December 2, 2001 through December 29, 2001.

(11)	Assumes the exercise of the full amount of the underwriters’ over-allotment option.

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the difficulty of identifying appropriate acquisition candidates;

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the difficulty of assimilating and integrating the operations of the respective entities;

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the potential disruption to our ongoing business and diversion of our management’s attention;

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the inability to maintain uniform standards, controls, procedures and policies; and

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the impairment of relationships with employees and customers as a result of changes in management.

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general economic conditions and conditions in local markets, which could reduce our sales;

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the competitive environment in the automotive aftermarket parts and accessories retail sector that may force us to reduce prices or increase spending;

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the automotive aftermarket parts manufacturing industry, such as consolidation, which may disrupt or sever one or more of our vendor relationships;

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our ability to anticipate and meet changes in consumer preferences for automotive products, accessories and services in a timely manner; and

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our continued ability to hire and retain qualified personnel, which depends in part on the types of recruiting, training and benefit programs we adopt.

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the weather, as vehicle maintenance may be deferred during periods of inclement weather; and

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the economy, as during periods of good economic conditions, more of our DIY customers may pay others to repair and maintain their cars instead of working on their own cars. In periods of declining economic conditions, both DIY and DIFM customers may defer vehicle maintenance or repair.

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successfully converting Discount’s information and accounting systems to ours;

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integrating our distribution operations with Discount’s distribution operations; and

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successfully completing the format and signage conversion of Discount stores to Advance Auto Parts stores in the Florida market.

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impair our ability to implement our growth strategy;

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impair our ability to obtain additional financing, if needed, for working capital, capital expenditures, acquisitions or other purposes in the future;

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place us at a disadvantage compared to competitors that have less debt;

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restrict our ability to adjust rapidly to changing market conditions;

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increase our vulnerability to adverse economic, industry and business conditions; or

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cause our interest expense to increase if interest rates in general were to increase because a portion of our indebtedness bears interest at a floating rate.

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economic and competitive conditions in the automotive aftermarket industry; and

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operating difficulties, operating costs or pricing pressures we may experience.

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incurring or guaranteeing additional indebtedness;

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paying dividends or making distributions or certain other restricted payments;

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making capital expenditures and other investments;

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creating liens on our assets;

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issuing or selling capital stock of our subsidiaries;

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transferring or selling assets currently held by us;

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repurchasing stock and certain indebtedness;

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engaging in transactions with affiliates;

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entering into any agreements that restrict dividends from our subsidiaries; and

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engaging in mergers or consolidations.

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actual or anticipated variations in our quarterly results of operations;

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changes in market valuations of companies in the retail automotive parts industry;

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changes in expectations of future financial performance or changes in estimates of securities analysts;

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fluctuations in stock market prices and volumes;

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issuances of common stock or other securities in the future;

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the addition or departure of key personnel; and

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announcements by us or our competitors of acquisitions, investments or strategic alliances.

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authorize our board of directors to issue “blank check” preferred stock and determine the powers, preferences and privileges of those shares without prior stockholder approval;

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prohibit the right of our stockholders to act by written consent;

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limit the calling of special meetings of stockholders; and

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impose a requirement that holders of 66 2/3% of the outstanding shares of common stock are required to amend the provisions relating to actions by written consent of stockholders and the limitations of calling special meetings.

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our ability to expand our business;

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the implementation of our business strategies and goals;

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integration of our previous and future acquisitions;

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a decrease in demand for our products;

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competitive pricing and other competitive pressures;

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our relationships with our vendors;

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our involvement as a defendant in litigation or incurrence of judgments, fines or legal costs;

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deterioration in general economic conditions;

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our ability to meet debt obligations and adhere to the restrictions and covenants imposed under our debt instruments;

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our critical accounting policies; and

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other statements that are not of historical fact made throughout this prospectus, including in the sections entitled “Summary,” “Risk Factors,” “Use of Proceeds,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business.”

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on an actual basis; and

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on an as adjusted basis to give effect to the sale of 845,394 shares of our common stock by us to the underwriters, assuming the underwriters’ exercise the full amount of the over-allotment option, and the use of the proceeds received by us from that sale, net of underwriting discounts and commissions and estimated offering expenses, to repay approximately $41.4 million of borrowings, on a pro rata basis, under the tranche A and tranche C term loans under our credit facility. Although this table reflects prepayment of these term loans, we may also use the proceeds to repurchase a portion of our 12.875% senior discount debentures and 10.25% senior subordinated notes.

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(1)

In June 2002, we repaid a portion of our tranche A and tranche B term loans and refinanced the remaining portion of our tranche B term loans, and amended and restated our senior credit facility to provide for (i) $430 million in term loans, consisting of a $180 million tranche A term loan facility due November 2006 and a $250 million tranche C term loan facility due November 2007 and (ii) a revolving credit facility of $160 million (a portion of which can be used for the issuance of letters of credit), with a maturity of five years. We had approximately $27.3 million in letters of credit outstanding and had no borrowings under the revolving credit facility at October 5, 2002, which reduced availability under the revolving credit facility to approximately $132.7 million as of that date.

(2)	In November 2002, we repurchased the entire $10 million in indebtedness under the McDuffie County Authority taxable industrial revenue bonds.

(3)	Subsequent to October 5, 2002, we repurchased and retired $8.5 million of our senior subordinated notes.

(4)	Reflects a stockholder subscription receivable and the repayment of the receivable by one of the selling stockholders from the proceeds received by the selling stockholder from shares sold in the offering.

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(1)	Our fiscal year consists of 52 or 53 weeks ending on the Saturday nearest to December 31. All fiscal years presented are 52 weeks except for 1997, which consisted of 53 weeks.

(2)	Represents restocking and handling fees associated with the return of inventory as a result of our supply chain initiatives.

(3)	Selling, general and administrative expenses exclude certain non-recurring charges discussed in notes (4), (5), (6), (7), (8), (9) and (10) below. The 1997 amount includes an unusual medical claim that exceeded our

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stop loss insurance coverage. The pre-tax amount of this claim, net of related increased insurance costs, was $882. We have increased our stop loss coverage effective January 1, 1998 to a level that would provide insurance coverage for a medical claim of this magnitude.

(4)	Represents costs of relocating certain equipment held at facilities closed as a result of our supply chain initiatives.

(5)	Represents the devaluation of certain property held for sale, including the $1.6 million charge taken in the first quarter of 2001 and a $10.7 million charge taken in the fourth quarter of 2001.

(6)	Represents expenses incurred in our 1998 recapitalization related primarily to non-recurring bonuses paid to certain employees and to fees for professional services.

(7)	Represents expenses related primarily to lease costs associated with 31 Advance Auto Parts stores closed in overlapping markets in connection with the Western merger and 27 Advance Auto Parts stores identified to be closed at December 29, 2001 as a result of the Discount acquisition.

(8)	Represents certain expenses related to the Western merger and integration, conversion of the Parts America stores and the Discount acquisition.

(9)	Reflects our estimate of expenses eliminated after the recapitalization that related primarily to compensation and other benefits of our chairman, who prior to our recapitalization was our principal stockholder.

(10)

Represents non-cash compensation expenses related to stock options granted to certain of our employees, including a non-recurring charge of $8.6 million in the fourth quarter of 2001 related to variable provisions of our stock option plans that were in place when we were a private company and that have since been eliminated.

(11)

EBITDA, as adjusted, represents operating income plus depreciation and amortization, non-cash and other employee compensation expenses and certain non-recurring charges as scheduled below, included in operating income. EBITDA, as adjusted, is not intended to represent cash flow from operations as defined by GAAP, and should not be considered as a substitute for net income as an indicator of operating performance or as an alternative to cash flow (as measured by GAAP) as a measure of liquidity. We have included EBITDA, as adjusted, herein because our management believes this information is useful to investors, as such measure provides additional information with respect to our ability to meet our future debt service, capital expenditures and working capital requirements and, in addition, certain covenants in our indentures and our credit facility are based upon an EBITDA calculation. Our method for calculating EBITDA, as adjusted, may differ from similarly titled measures reported by other companies. Our management believes certain recapitalization expenses, non-recurring charges, private company expenses, non-cash and other employee compensation expenses, and merger and integration expenses should be eliminated from the EBITDA calculation to evaluate our operating performance, and we have done so in our calculation of EBITDA, as adjusted.

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(a)

The 1997 EBITDA amount excludes an unusual medical claim that exceeded our stop-loss insurance coverage. The pre-tax amount of this claim, net of related increased insurance costs, was $882. We have increased our stop-loss coverage effective January 1, 1998 to a level that would provide insurance coverage for a medical claim of this magnitude.

(b)

Represents the interest component of the net periodic postretirement benefit cost associated with our postretirement benefit plan.

(c)

EBITDA, as adjusted, for 2000 includes a non-recurring net gain of $3.3 million, which represents a portion of a cash settlement received in connection with a lawsuit against a supplier. EBITDA, as adjusted, for 2001 includes a non-recurring net gain of $3.2 million, recorded in the first quarter of 2001, which represents a portion of the cash settlement received in connection with the lawsuit against a supplier, partially offset by nonrecurring closed store expenses and the $1.6 million write-down of an administrative facility taken in the first quarter of 2001.

(12)	Capital expenditures for 2001 exclude $34.1 million for our November 2001 purchase of Discount’s Gallman, Mississippi distribution facility from the lessor in connection with the Discount acquisition.

(13)

Comparable store sales growth is calculated based on the change in net sales starting once a store has been opened for thirteen complete accounting periods (each period represents four weeks). Relocations are included in comparable store sales from the original date of opening. The Parts America stores acquired in the Western merger and subsequently converted to Advance Auto Parts stores are included in the comparable store sales calculation after thirteen complete accounting periods following their physical conversion. Stores acquired in the Carport acquisition are included in the comparable store sales calculation following thirteen complete accounting periods after their system conversion to the Advance Auto Parts store system. Stores acquired in the Discount acquisition will be included in the comparable stores sales calculation beginning in December 2002, which is thirteen complete accounting periods after the acquisition date of November 28, 2001. Comparable store sales do not include sales from our Western Auto stores.

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(14)	Net new stores represent new stores opened and acquired, less stores closed. The negative net new stores count for the forty weeks ended October 5, 2002 is a result of closing 130 Discount and Advance stores in our existing markets as part of the integration of Discount.

(15)

Average net retail sales per store is based on the average of beginning and ending number of stores for the respective period. The 1998 amounts were calculated giving effect to the Parts America retail net sales and number of stores for the period from November 1, 1998 through January 2, 1999. The fiscal 2001 amounts were calculated giving effect to the Discount retail net sales and number of stores for the period from December 2, 2001 through December 29, 2001.

(16)

Average net retail sales per square foot is based on the average of beginning and ending total store square footage for the respective period. The 1998 amounts were calculated giving effect to the Parts America retail net sales and square footage for the period from November 1, 1998 through January 2, 1999. The fiscal 2001 amounts were calculated giving effect to the Discount retail net sales and number of stores for the period from December 2, 2001 through December 29, 2001.

(17)	Net debt includes total debt and bank overdrafts, less cash and cash equivalents.

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(a)

The valuations of the fair values of Discount’s tangible and intangible assets are reflected in our historical balance sheet at December 29, 2001. Accordingly, this adjustment reflects the pro forma effect on depreciation and amortization for 2001.

(b)

Reflects pro forma interest expenses calculated assuming (i) a LIBOR rate of 2.0% plus a spread of 3.5% for the tranche A term loan and a LIBOR rate of 3.0% (the established floor) plus a spread of 4.0% for the tranche B term loan portions of our senior credit facility, respectively, (ii) a yield to maturity of 11.875% on the senior subordinated notes, which includes a cash interest component based on a coupon rate of 10.25%, and (iii) commitment fees on unused borrowings on our senior credit facility using a rate of 0.5% per annum. The interest rates on the senior credit facility are variable. A change in the rates of 1/8 of 1% on these borrowings would change the pro forma interest expense for the year ended December 29, 2001 by $488. The adjustments for the year ended December 29, 2001, excluding the historical interest expense and amortization of debt issuance costs, represent pro forma amounts through the date of the acquisition.

(3)	Estimated tax effects of the pro forma adjustments at a statutory rate of approximately 40%.

(4)	Income (loss) from continuing operations represents income (loss) before extraordinary item and the cumulative effect of a change in accounting principle.

(5)

Diluted earnings per share from continuing operations includes certain non-recurring charges of $20.9 million after-tax, or $0.72 per diluted share. These charges consist of $0.7 million in conversion expenses associated with the Discount acquisition, $2.2 million in lease termination expenses, $5.2 million in stock option compensation charges, $6.3 million in supply chain initiatives and a $6.5 million reduction in book value of property currently held for sale.

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(1)

Cost of sales and selling, general and administrative expenses presented for fiscal 2001 and the forty weeks ended October 6, 2001 and October 5, 2002 reflect the change in accounting principle related to cooperative advertising funds. This change resulted in lower cost of sales with corresponding increases in selling, general and administrative expenses.

(2)	Selling, general and administrative expenses are adjusted for certain non-recurring and other items.

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(1)	Reflects the change in accounting principle related to the cooperative advertising funds.

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(1)	Long-term debt includes the fully accreted senior subordinated notes and senior discount debentures.

(2)	Represents indebtedness under the McDuffie County Development Authority taxable industrial revenue bonds which was repurchased on November 1, 2002.

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increased our store count at year-end from 814 to 2,484;

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achieved positive comparable store sales growth in every quarter and averaged 6.9% annually;

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increased our net sales at a compound annual growth rate of 38.8%, from $848.1 million to $3.1 billion (pro forma for the Discount acquisition); and

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increased our EBITDA, as adjusted, at a compound annual growth rate of 39.9%, from $68.4 million to $261.9 million (pro forma for the Discount acquisition).

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increasing number and age of vehicles in the United States, increasing number of miles driven annually, increasing number of cars coming off of warranty, particularly leased vehicles;

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higher cost of replacement parts as a result of technological changes in recent models of vehicles and increasing number of light trucks and sport utility vehicles that require more expensive parts, resulting in higher average sales per customer; and

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continued consolidation of automotive aftermarket retailers, resulting in a reduction in the number of stores in the marketplace and enhanced profitability and returns on capital.

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(1)	Does not include stores that opened as relocations of existing stores within the same general market area or substantial renovations of stores.

(2)

Includes 560 Parts America stores, net of 52 closures, acquired as part of the Western merger in November 1998. Subsequent to 1998, we closed an additional 15 Western stores resulting in a net of 545 stores obtained in the Western merger. Three Advance stores were also closed during fiscal 1998 in connection with the Western merger.

(3)	Includes 30 Carport stores acquired on April 23, 2001 and 671 Discount stores acquired on November 28, 2001.

(4)	Includes 130 Discount and Advance stores closed in our existing markets as part of the integration of Discount.

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(1)	This facility is owned by Nicholas F. Taubman. See “Related-Party Transactions.”

(2)	The construction of this facility was financed in 1997 by a $10.0 million industrial revenue bond issuance from the Development Authority of McDuffie County of the State of Georgia, from whom we purchased this facility for $10.00 in November 2002.

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(3)	Total capacity of this facility is approximately 433,000 square feet, of which 50,000 square feet continues to be used as a PDQ® Express warehouse. This facility was also used as a distribution center prior to its closure in the fourth quarter of 2001. This facility is currently held for sale.

(4)	This facility is located within one of our main distribution centers.

(5)	This facility is owned by Ki, L.C., a Virginia limited liability company owned by two trusts for the benefit of a child and grandchild of Nicholas F. Taubman. See “Related-Party Transactions.”

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(1)	Of these stores, 17 are owned by our affiliates. See “Related-Party Transactions.”

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(1)	Member of Nominating and Corporate Governance Committee.

(2)	Member of Compensation Committee.

(3)	Member of Audit Committee.

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(1)	Mr. Castellani received a signing bonus that was accrued on January 1, 2000 in connection with his appointment as Chief Executive Officer. Approximately $1.9 million of the bonus was used to purchase shares of our common stock.

(2)	Consists of matching contributions made by us under our 401(k) savings plan.

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(1)	Represents the fair market value of the underlying shares of common stock at the time of the grant, as determined by our board of directors.

(2)

The potential realizable value is calculated assuming that the fair market value of our common stock appreciates at the indicated annual rate compounded annually for the entire seven-year term of the option, and that the option is exercised and the underlying shares of our common stock sold on the last day of its seven-year term for the appreciated stock price. The assumed 5% and 10% rates of appreciation are mandated by the rules of the SEC and do not represent our estimate of the future prices or market value of our common stock.

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(1)	Values for “in-the-money” outstanding options represent the positive spread between the respective exercise prices of the outstanding options and the fair market value underlying Advance common stock on December 28, 2001 of $47.05.

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each person or entity known to us that beneficially owns more than 5% of our common stock;

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each stockholder selling shares of our common stock in this offering;

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each of our named executive officers and certain other executive officers;

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each member of our board of directors; and

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all of our executive officers and directors as a group.

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*	Less than 1% of the outstanding shares of common stock

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(1)

These shares are held of record by FS Equity Partners IV, L.P., or FSEP IV. As the general partner of FSEP IV, FS Capital Partners LLC has the sole power to vote and dispose of the shares owned by FSEP IV. Messrs. Doran, Roth, Spogli, Bradford M. Freeman, Todd W. Halloran, Jon D. Ralph, Charles P. Rullman, J. Frederick Simmons and William M. Wardlaw are the managing members of FS Capital Partners LLC, and Messrs. Doran, Freeman, Halloran, Ralph, Roth, Rullman, Simmons, Spogli and Wardlaw are the members of Freeman Spogli & Co. LLC, and as such may be deemed to be the beneficial owners of the shares of our common stock and rights to acquire our common stock owned by FSEP IV. The business address of Freeman Spogli & Co., FSEP IV, FS Capital Partners, and Messrs. Freeman, Spogli, Wardlaw, Simmons, Roth, Rullman, Ralph, Halloran and Doran is 11100 Santa Monica Boulevard, Suite 1900, Los Angeles, California 90025.

(2)

These shares are held of record by Sears. Messrs. Liska and Richter, as Executive Vice President and President, Credit and Financial Products, and Senior Vice President and Chief Financial Officer, respectively, of Sears, have the power to direct the voting of the shares of our common stock held by Sears, and as such may be deemed to be the beneficial owners of the shares of our common stock owned by Sears. The business address of Sears, Mr. Liska and Mr. Richter is 3333 Beverly Road, Hoffman Estates, Illinois 60179.

(3)	Includes 250,000 shares subject to immediately exercisable options.

(4)	Includes 250,000 shares subject to immediately exercisable options. The trustees of the Arthur Taubman Trust dated July 13, 1964 are Eugenia Taubman, who is the spouse of Nicholas F. Taubman, and First Premier Bank.

(5)	Includes an aggregate of 11,890 shares held by Mr. Castellani’s children.

(6)

Includes shares of our common stock subject to options beneficially owned by the following persons and exercisable within 60 days of November 13, 2002: Mr. Castellani–720,000 options; Mr. Wade–66,166 options; Mr. Reid–60,332 options; Mr. Klasing–54,833 options; and Ms. Stevens–42,999 options. In addition to these options that are exercisable within 60 days of November 13, 2002, Mr. Castellani owns 455,000 options to purchase common stock that are not exercisable within 60 days of November 13, 2002 with a weighted average exercise price of $27.55 per share.

(7)

Reflects shares of our common stock held by the Peter J. Fontaine Revocable Trust, Fontaine Industries Limited Partnership and Peter J. Fontaine, individually. As trustee of the Peter J. Fontaine Revocable Trust, which is the general partner of Fontaine Industries Limited Partnership, Mr. Fontaine has the power to direct the voting of the shares of our common stock held by the Fontaine Trust and Fontaine Industries Limited Partnership.

(8)	The business address of Mr. Peck is 505 Park Avenue, 5th Floor, New York, New York 10022.

(9)	Represents 1,666 shares subject to options beneficially owned by Mr. Salter and exercisable within 60 days of November 13, 2002. The business address of Mr. Salter is 3333 Beverly Road, Hoffman Estates, Illinois 60179.

(10)	The business address of Ms. Spinelli is 100 Throckmorton Street, Suite 1900, Fort Worth, Texas 76102.

(11)	Includes 1,468,829 shares of our common stock subject to options beneficially owned by our executive officers and directors and exercisable within 60 days of November 13, 2002.

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the board of directors approved the transaction before the “interested stockholder” obtained such status;

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upon consummation of the transaction that resulted in the stockholder becoming an “interested stockholder,” the “interested stockholder” owned at least 85% of our outstanding common stock at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned (i) by persons who are directors and are also officers and (ii) employee stock plans in which the participants do not have the right to determine confidentially whether shares held subject to the plans will be tendered in the tender or exchange offer; or

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on or subsequent to such date, the business combination or merger is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by two-thirds of the holders of the outstanding common stock not owned by the “interested stockholder.”

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1% of our then outstanding shares of the common stock, approximately 356,926 shares as of November 13, 2002; or

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the average weekly trading volume in our common stock during the four calendar weeks preceding the filing of a notice of the sale with the SEC.

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an individual who is neither a citizen nor a resident of the U.S. (as determined for U.S. federal income tax purposes);

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a corporation or other entity taxed as a corporation that is organized or created under non-U.S. law;

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an estate that is not taxable in the U.S. on its worldwide income; or

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a trust that is either not subject to primary supervision by a U.S. court or not subject to the control of a U.S. person with respect to substantial trust decisions.

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The discussion assumes that you hold your common stock as a capital asset and that you do not have a special tax status.

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The discussion does not consider tax consequences that depend upon your particular tax situation in addition to your ownership of the common stock.

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The discussion does not consider special tax provisions that may be applicable to you if you have relinquished U.S. citizenship or residence.

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The discussion does not cover state, local or foreign law.

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We have not requested a ruling from the Internal Revenue Service (“IRS”) on the tax consequences of owning the common stock. As a result, the IRS could disagree with portions of this discussion.

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the gain is effectively connected with a trade or business of the non-U.S. holder in the United States and, if certain tax treaties apply, is attributable to a permanent establishment in the U.S. maintained by such holder;

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in the case of a non-resident alien individual who holds the common stock as a capital asset, the individual is present in the United States for a period or periods aggregating 183 or more days in the taxable year of the disposition and certain conditions are met; or

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unless an exception applies, we are or have been a U.S. real property holding corporation at any time within the five-year period preceding the disposition or during the non-U.S. holder’s holding period, whichever period is shorter.

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a U.S. person;

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a foreign person that derives 50% or more of its gross income for certain periods from the conduct of a trade or business in the U.S.;

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a controlled foreign corporation as defined in the Code; or

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a foreign partnership with certain U.S. connections.

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Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum.

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Over-allotment involves sales by the underwriters of shares in excess of the number of shares the underwriters are obligated to purchase, which creates a syndicate short position. The short position may be either a covered short position or a naked short position. In a covered short position, the number of shares over-allotted by the underwriters is not greater than the number of shares that they may purchase in the over-allotment option. In a naked short position, the number of shares involved is greater than the number of shares in the over-allotment option. The underwriters may close out any covered short position by either exercising their over-allotment option and/or purchasing shares in the open market.

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Syndicate covering transactions involve purchases of the common stock in the open market after the distribution has been completed in order to cover syndicate short positions. In determining the source of shares to close out the short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option. If the underwriters sell more shares than could be covered by the over-allotment option, a naked short position, the position can only be closed out by buying shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering.

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Penalty bids permit the representatives to reclaim a selling concession from a syndicate member when the common stock originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.

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the purchaser is entitled under applicable provincial securities laws to purchase the common stock without the benefit of a prospectus qualified under those securities laws,

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where required by law, that the purchaser is purchasing as principal and not as agent, and

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the purchaser has reviewed the text above under Resale Restrictions.

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Our Annual Report on Form 10-K for the fiscal year ended December 29, 2001 filed with the SEC on March 28, 2002, including portions of our Proxy Statement for our 2002 Annual Meeting of Stockholders incorporated by reference therein;

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Our Quarterly Reports on Form 10-Q filed with the SEC on May 23, 2002, August 14, 2002 and November 19, 2002;

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Our Current Reports on Form 8-K filed with the SEC on January 16, 2002, March 7, 2002, April 5, 2002 (as amended on April 16, 2002), July 3, 2002 and November 22, 2002;

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The audited consolidated financial statements of Discount Auto Parts, Inc. for the three years ended May 29, 2001 and the unaudited condensed consolidated financial statements of Discount Auto Parts, Inc. for the twenty-six week periods ended November 27, 2001 and November 28, 2000, which are contained in our prospectus dated March 6, 2002, which is part of our Registration Statement on Form S-1 (Reg. No. 333-82298); and

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The description of our common stock contained in our Registration Statement on Form 8-A filed with the SEC on November 29, 2001.

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(a)	Includes $1,652 assigned to the Discount trade dress with a useful life of approximately 3 years.

(b)	Includes restructuring liabilities established in purchase accounting of approximately $11,397 for severance and relocation costs, facility and other exit costs.

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(a)	The Other and Related Party columns include stores closed as a result of the Company’s restructuring plans.

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(a)	Amounts include non-recurring expenses separately disclosed in the accompanying statement of operations.

(b)

During fiscal 1999, certain assets, liabilities and the corresponding activity related to the Parts America store operations and a distribution center were transferred to the Retail segment through a dividend to Retail. Additionally, throughout fiscal 2000, the Company transferred certain assets to the Retail segment related to the Western Auto retail operations in Puerto Rico and the Virgin Islands.

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(c)

For the forty weeks ended October 5, 2002 and October 6, 2001, total net sales include approximately $378,000 and $268,000, respectively, related to revenues derived from commercial sales. For fiscal years 2001, 2000, and 1999, total net sales include approximately $403,000, $356,000 and $245,000, respectively, related to revenues derived from commercial sales.

(d)	Excludes investment in and equity in net earnings or losses of subsidiaries.

(e)	Fiscal 1999 results of operations do not reflect the allocation of certain shared expenses to the Wholesale segment. During fiscal 2000, Management adopted a method for allocating shared expenses.

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(a)	Includes $1,652 assigned to the Discount trade dress with a useful life of approximately 3 years.

(b)	Includes restructuring liabilities established in purchase accounting of approximately $11,397 for severance and relocation costs, facility and other exit costs (Note 4)

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(a)	The Other and Related Parties columns include stores closed as a result of the Company’s restructuring plans (See Note 4).

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(a)	Amounts include non-recurring expenses separately disclosed in the accompanying statement of operations.

(b)

During fiscal 1999, certain assets, liabilities and the corresponding activity related to the Parts America store operations and a distribution center were transferred to the Retail segment through a dividend to Retail. Additionally, throughout fiscal 2000, the Company transferred certain assets to the Retail segment related to the Western Auto retail operations in Puerto Rico and the Virgin Islands.

(c)	For fiscal years 2001, 2000, and 1999, total net sales include approximately $403,000, $356,000 and $245,000, respectively, related to revenues derived from commercial sales.

(d)	Excludes investment in and equity in net earnings or losses of subsidiaries.

(e)	Fiscal 1999 results of operations do not reflect the allocation of certain shared expenses to the Wholesale segment. During fiscal 2000, Management adopted a method for allocating shared expenses.

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(1)	Represents amounts paid for restructuring charges.

(2)	Restructuring reserves assumed and established in the Western merger.

(3)	Reductions to reserves assumed and established in the Western merger that exceeded the ultimate cost expended by the Company.

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