10-K: Annual report pursuant to Section 13 and 15(d)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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 31, 2000, or

[ ] Transition report pursuant to section 13 or 15(d) of the Securities

    Exchange Act of 1934

    Commission file number 1-6991.

    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 at least 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 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.    [ ]

    The aggregate market value of the voting stock held
by non-affiliates of the registrant, based on the closing price of these shares on the New
York Stock Exchange on March 31, 2000, was $146,684,895,928. For the purposes of this
disclosure only, the registrant has assumed that its directors, officers and

Page 1 of 25 (Form 10-K)

beneficial owners of 5% or more of the registrant’s common stock
are the affiliates of the registrant.

    The registrant had 4,454,034,171 shares of common
stock outstanding as of March 31, 2000.

    Portions of the registrant’s Annual Report to
Shareholders for the fiscal year ended January 31, 2000, are incorporated by reference
into Parts I and II of this Form 10-K.

    Portions of the registrant’s definitive Proxy
Statement for the Annual Meeting of Shareholders to be held June 2, 2000, are incorporated
by reference into Part III and IV of this Form 10-K.

    This Form 10-K includes certain statements that may
be deemed to be "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Statements included or incorporated by reference
in this Form 10-K which address activities, events or developments that the Company
expects or anticipates will or may occur in the future, including such things as future
capital expenditures (including the amount and nature thereof), expansion and other
development trends of industry segments in which the Company is active, business strategy,
expansion and growth of the Company’s business and operations and other such matters
are forward-looking statements. Although the Company believes the expectations expressed
in such forward-looking statements are based on reasonable assumptions within the bounds
of its knowledge of its business, a number of factors could cause actual results to differ
materially from those expressed in any forward-looking statements, whether oral or
written, made by or on behalf of the Company. Many of these factors have previously been
identified in filings or statements made by or on behalf of the Company.

    All phases of the Company’s operations are
subject to influences outside its control. Any one, or a combination, of these factors
could materially affect the results of the Company’s operations. These factors
include: the cost of goods, competitive pressures, inflation, consumer debt levels,
currency exchange fluctuations, trade restrictions, changes in tariff and freight rates,
Year 2000 issues, unemployment levels, interest rate fluctuations and other capital market
and economic conditions. Forward-looking statements made by or on behalf of the Company
are based on a knowledge of its business and the environment in which it operates, but
because of the factors listed above, actual results may differ from those in the
forward-looking statements. Consequently, all of the forward-looking statements made are
qualified by these and other cautionary statements, and there can be no assurance that the
actual results or developments anticipated by the Company will be realized or, even if
substantially realized, that they will have the expected consequences to or effects on the
Company or its business or operations.

Page 2 of 25 (Form 10-K)

        Wal-Mart Stores, Inc.
(together with its subsidiaries hereinafter referred to as the "Company") is the
world’s largest retailer measured by total revenues. During the fiscal year ended
January 31, 2000, the Company had net sales of $165,013,000,000.

(a) Development of Business

        Domestically, at January 31,
2000, the Company operated 1,801 discount stores, 721 Supercenters, and 463 SAM’S
Clubs. Tables summarizing information concerning additions of units and square footage for
domestic discount stores, Supercenters and SAM’S Clubs in fiscal years 1995 through
2000, are included as Schedules A and B to Item 1 found on pages 11 and 12 of this annual
report.

        In the third quarter of
fiscal 2000, the Company acquired ASDA Group PLC (ASDA), the third largest retailer in the
United Kingdom with, at that time, 229 stores. In June and July of 1999, the Company
acquired 29% of the outstanding ASDA shares on the open market and made a cash tender
offer for all remaining ASDA shares other than shares held by shareholders residing in
certain countries. As of the end of the third quarter of fiscal 2000, the Company had
acquired 100% of the outstanding shares of ASDA. The acquired assets are included in the
Company’s consolidated balance sheet as of January 31, 2000, and five months of
results of ASDA operations are included in the Company’s consolidated statements of
income for the year ended January 31, 2000. ASDA reports on a December 31 year-end,
therefore ASDA results are consolidated on a trailing month reporting basis.

        In fiscal 2000, the Company
increased its investment in Korea by acquiring most of the minority interest in its
operations in Korea from its joint venture partner. The Company anticipates that the
remaining minority interest will be acquired in early fiscal 2001.

        See Note 6 of Notes to
Consolidated Financial Statements incorporated by reference in Item 8 of Part II found on
page 19 of this annual report for additional information regarding our acquisitions.

        Internationally, at January
31, 2000, the Company operated units in Argentina(13), Brazil(14), Canada(166),
Germany(95), Korea(5) Mexico(458), Puerto Rico(15)and the United Kingdom (232), and, under
joint venture agreements in China(6). Tables summarizing information concerning additions
of units and square footage for international units operated since January 31, 1995 is
included as Schedule C to Item 1, found on pages 13 and 14 of this annual report.

Page 3 of 25 (Form 10-K)

In the fourth quarter of fiscal 2000, the Company joined with Accel
Partners, a Silicon Valley based venture capital firm, to form Wal-mart.com, Inc.
Wal-Mart.com, Inc. will base its operations in Palo Alto, California and was formed to
further develop and operate the internet retail site, Wal-Mart.com, and to further the
Company’s efforts to attract customers to the Company’s internet site with the
Wal-Mart name.

(b) Financial information about the Company’s industry

    segments

        The Company is principally
engaged in the operation of mass merchandising stores, which serve our customers primarily
through the operation of three segments.

        The Company identifies
segments based on management responsibility within the United States and geographically
for all international units. The Wal-Mart Stores segment includes the Company’s
discount stores and Supercenters in the United States. The SAM’S Club segment
includes the warehouse membership clubs in the United States. The International segment
includes all operations in Argentina, Brazil, Canada, China, Germany, Korea, Mexico,
Puerto Rico and the United Kingdom. For the financial results of the Company’s
operating segments, see Note 9 of Notes to Consolidated Financial Statements incorporated
by reference in Item 8 of Part II, found on page 19 of this annual report.

(c) Narrative Description of Business

        The Company, a Delaware
corporation, has its principal offices in Bentonville, Arkansas. Although the Company was
incorporated in October 1969, the businesses conducted by its predecessors began in 1945
when Sam M. Walton opened a franchise Ben Franklin variety store in Newport, Arkansas. In
1946, his brother, James L. Walton, opened a similar store in Versailles, Missouri. Until
1962, the Company’s business was devoted entirely to the operation of variety stores.
In that year, the first Wal-Mart Discount City (discount store) was opened. In fiscal
1984, the Company opened its first three SAM’S Clubs, and in fiscal 1988, its first
Wal-Mart Supercenter (combination full-line supermarket and discount store). In fiscal
1992, the Company began its first international initiative when the Company entered into a
joint venture in which it had a 50% interest with Cifra S.A. de C.V. (Cifra). The
Company’s international presence has continued to expand and at January 31, 2000, the
Company had international operations in eight countries and Puerto Rico. In February 2000,
Cirfa officially changed its name to Wal-Mart de Mexico, S.A. de C.V.

        The Wal-Mart Stores segment,
which includes the Company’s discount stores and Supercenters in the United States,
had sales of $108,721,000,000, $95,395,000,000 and $83,820,000,000 for the three fiscal
years ended January 31, 2000, 1999, and 1998, respectively. During the most recent fiscal
year, no single discount store or Supercenter location accounted for as much as 1% of
total Company sales or net income. See Note 9 of Notes to Consolidated Financial

Page 4 of 25 (Form 10-K)

Statements incorporated by reference in Item 8 of Part II, found on
page 19 of this annual report for additional information regarding our operating segments.

        General.
The Company operates Wal-Mart discount stores in all 50 states. The average size of a
discount store is approximately 94,800 square feet. Wal-Mart Supercenters are located in
34 states and the average size of a Supercenter is 181,300 square feet. The Supercenter
prototypes range in size from 110,000 square feet to 241,000 square feet.

        Merchandise.
Wal-Mart discount stores and the general merchandise area of the Supercenters are
generally organized with 40 departments and offer a wide variety of merchandise, including
apparel for women, girls, men, boys and infants. Each store also carries domestics,
fabrics and notions, stationery and books, shoes, housewares, hardware, electronics, home
furnishings, small appliances, automotive accessories, horticulture and accessories,
sporting goods, toys, pet food and accessories, cameras and supplies, health and beauty
aids, pharmaceuticals and jewelry. In addition, the stores offer an assortment of grocery
merchandise, with the grocery assortment in Supercenters being broader and including meat,
produce, deli, bakery, dairy, frozen foods and dry grocery.

        Nationally advertised
merchandise accounts for a majority of sales in the stores. The Company markets lines of
merchandise under store brands including but not limited to "Sam’s American
Choice", "One Source", "Great Value", "Ol’ Roy"
and "Equate". The Company also markets lines of merchandise under licensed
brands, some of which include "Faded Glory", "Kathie Lee", "White
Stag", "Puritan", "Better Homes & Gardens", "Popular
Mechanics", "Catalina", "McKids", and "Basic
Equipment".

        During the fiscal year ended
January 31, 2000, sales in discount stores and Supercenters (which are subject to seasonal
variance) by product category were as follows:

        Operations. Hours
of operation for nearly all Supercenters and an increasing number of discount stores are
24 hours each day. Hours of operation

Page 5 of 25 (Form 10-K)

for the remaining discount stores vary by location, but generally range
from 7:00a.m. to 11:00 p.m., six days a week, and from 10:00 a.m. to 8:00 p.m. on Sundays.
Wal-Mart discount stores and Supercenters maintain uniform prices, except where lower
prices are necessary to meet local competition. Sales are primarily on a self-service,
cash-and-carry basis with the objective of maximizing sales volume and inventory turnover
while minimizing expenses. Bank credit card programs, operated without recourse to the
Company, are available in all stores.

        Seasonal Aspects of
Operations. The Wal-Mart Stores operating segment’s business is seasonal to a
certain extent. Generally, the highest volume of sales occurs in the Company’s fourth
fiscal quarter and the lowest volume occurs during its first fiscal quarter.

        Competition.
Wal-Mart discount stores compete with other discount, department, drug, variety and
specialty stores, many of which are national chains. Wal-Mart Supercenters compete with
other supercenter-type stores, discount stores, supermarkets and specialty stores, many of
which are national or regional chains. The Company also competes with others for new store
sites. As of January 31, 2000, based on net sales, the Wal-Mart Stores segment ranked
first among all retail department store chains and among all discount department store
chains.

        The Company’s
competitive position within the industry is largely determined by its ability to offer
value and service to its customers. The Company has many programs designed to meet the
competitive pressures within its industry. These include the Company’s "Everyday
Low Price", "Item Merchandising", "Store-Within-a-Store" and
"Price Rollbacks" programs. Although the Company believes it has had a major
influence in most of the retail markets in which its stores are located, there is no
assurance that this influence will continue.

        Distribution.
During fiscal 2000, approximately 83% of the Wal-Mart discount stores’ and
Supercenters’ purchases were shipped from Wal-Mart’s 45 distribution centers,
ten of which are grocery distribution centers, and two of which are import distribution
centers. The balance of merchandise purchased was shipped directly to the stores from
suppliers. The 45 distribution centers are located throughout the continental United
States. Five distribution centers are located in each of Arkansas and Texas; three in each
of South Carolina and New York; two in each of California, Florida, Georgia, Indiana,
Mississippi, and Pennsylvania; and one in each of Alabama, Arizona, Colorado, Iowa,
Illinois, Kansas, Kentucky, Michigan, New Mexico, North Carolina, Ohio, Oklahoma, Oregon,
Tennessee, Utah, Virginia and Wisconsin.

        The SAM’S Club segment,
which includes the warehouse membership clubs in the United States, had sales of
$24,801,000,000, $22,881,000,000 and $20,668,000,000 for the three fiscal years ended
January 31, 2000, 1999, and 1998, respectively. During the most recent fiscal year, no
single club location accounted for as much as 1% of total Company sales or net income. See
Note 9 of Notes to Consolidated Financial Statements incorporated by reference in Item 8
of

Page 6 of 25 (Form 10-K)

Part II found on page 19 of this annual report for additional
information regarding our segments.

        General. The
Company operates SAM’S Clubs in 48 states. The average size of a SAM’S Club is
approximately 121,700 square feet, and club sizes generally range between 90,000 and
154,000 square feet of building area.

        Merchandise. SAM’S
Clubs offer bulk displays of name brand hardgood merchandise, some softgoods and
institutional size grocery items, and selected items under the "Member's Mark"
store brand. Generally each SAM’S Club also carries software, electronic goods,
jewelry, sporting goods, toys, tires, stationery and books. Most clubs have fresh food
departments, which include bakery, meat and produce. In addition, some clubs offer
one-hour photo, embroidery departments, pharmaceuticals, optical departments and gas
stations.

        During the fiscal year ended
January 31, 2000, sales in the clubs (which are subject to seasonal variance) by product
category were as follows:

       Operations. Operating
hours vary among SAM’S Clubs, but they are generally open Monday through Friday from
10:00 a.m. to 8:30 p.m. Saturday from 9:30 a.m. to 8:30 p.m. and Sunday from 11:00 a.m. to
6:00 p.m.

        SAM’S Clubs are
membership only, cash-and-carry operations. However, a financial service credit card
program (Discover Card) is available in all clubs and the "SAM’S Direct"
commercial finance program and "Business Revolving Credit" are available to
qualifying business members. Also, a "Personal Credit" program is available to
qualifying club members. Any credit extended to members under these programs is without
recourse to the Company. Club members include businesses and those individuals who are
members of certain qualifying organizations, such as government and state employees and
credit union members. In fiscal 2000, business members paid an annual membership fee of
$30 for the primary membership card with a spouse card available at no additional cost.
The annual membership fee for an individual member is $35 for the primary membership card
with a spouse card available at no additional cost. During fiscal 2000, SAM’S Clubs
launched an Elite Membership program which offers additional benefits such as long
distance service, roadside assistance, internet access, home improvement, Telebank,
business insurance and financial planning, auto brokering, pharmacy discounts, and
entertainment savings guides to Elite Members. The annual membership fee for an Elite
Member is $100.

Page 7 of 25 (Form 10-K)

        Seasonal Aspects of
Operations. The SAM’S Club operating segment’s business is seasonal to a
certain extent. Generally, the highest volume of sales occurs in the Company’s fourth
fiscal quarter and the lowest volume occurs during its first fiscal quarter.

        Competition.
SAM’S Clubs compete with other warehouse clubs, as well as with discount retailers,
wholesale grocers and general merchandise wholesalers and distributors. The Company also
competes with others for new club sites. As of January 31, 2000, based on domestic U.S.
net sales, the SAM’S Club segment ranked first among all warehouse clubs.

        Distribution.
During fiscal 2000, approximately 57% of the SAM’S Club purchases were shipped from
the Segment’s distribution facilities. The balance was shipped directly to the clubs
location from suppliers. Operationally, the principal focus is on crossdocking product,
while maintaining stored inventory is minimized. A combination of 6 Company owned and
operated facilities and 19 third-party owned and operated facilities comprise the overall
distribution structure for the SAM’s Club segment. Two of the Company owned and
operated facilities are located in Texas with one located in each of Arkansas, Colorado,
Minnesota and Indiana. Of the third party owned and operated facilities, two are located
in each of Illinois, Ohio and Texas and one in each of Arizona, Arkansas, California,
Florida, Georgia, Maryland, Michigan, Missouri, New Hampshire, Nevada, North Carolina,
Pennsylvania and Washington.

        The Company’s
International Segment is comprised of wholly owned operations in Argentina, Canada,
Germany, Korea, Puerto Rico and the United Kingdom; of operations through joint ventures
in China; and of opertions through majority-owned subsidiaries in Brazil and Mexico. Sales
for the three fiscal years ended January 31, 2000, 1999 and 1998, were $22,728,000,000,
$12,247,000,000 and $7,517,000,000, respectively. During the most recent fiscal year, no
single location accounted for as much as 1% of total Company sales or net income. See Note
9 of Notes to Consolidated Financial Statements incorporated by reference in Item 8 of
Part II found on page 19 of this annual report for additional information regarding our
segments.

        General.
Operating formats vary by country, but include Wal-Mart discount stores in Canada and
Puerto Rico; Supercenters in Argentina, Brazil, China, Korea and Mexico; SAM’S Clubs
in Brazil, China, Mexico, and Puerto Rico; Hypermarkets in Germany; Superamas (traditional
supermarket), Bodegas (discount store), Aurreras (combination store), Suburbias (specialty
department store) and Vips (restaurant) in Mexico and ASDA stores (combination grocery and
apparel store) in the United Kingdom. In March 2000, the Company announced the sale of

Page 8 of 25 (Form 10-K)

all three of the Company’s SAM’S Clubs in Argentina. The sale
is being made so that the Company can concentrate on expanding its Supercenter business
within Argentina.

        Merchandise.
The merchandising strategy in the International operating segment is similar to that of
domestic segments in the breadth and scope of merchandise offered for sale. While brand
name merchandise accounts for a majority of sales, several store brands not found in the
United States have been developed to serve customers in the different markets in which the
International segment operates. In addition, steps have been taken to develop
relationships with local vendors in each country to ensure reliable sources of quality
merchandise.

        Operations.
The hours of operation for operating units in the international division vary by country
and by individual markets within countries, depending upon local and national ordinances
governing hours of operation. While sales are primarily on a cash-and-carry basis, credit
cards or other consumer finance programs exist in certain markets to facilitate the
purchase of goods by the customer.

        Seasonal Aspects of
Operations. The International operating segment’s business is seasonal to a
certain extent. Generally, the highest volume of sales occurs in the Company’s fourth
fiscal quarter. The seasonality of the business varies by country due to different
national and religious holidays, festivals and customs, as well as different climatic
conditions.

        Competition.
The International operating segment competes with a variety of local, national and
international chains in the discount, department, drug, variety, specialty and wholesale
sectors of the retail market. The segment’s competitive position is determined, to a
large extent, by its ability to offer its customers low prices on quality merchandise that
offers exceptional value. In Supercenters, our ability to effectively operate the food
departments has a major impact on the segment’s competitive position in the markets
where we operate.

        Distribution.
The International segment operates export consolidation facilities in Los Angeles,
California; Jacksonville, Florida; Seattle, Washington; and Laredo, Texas in support of
product flow to its Mexican, Asian, and Latin American markets. Distribution facilities
are located in Argentina, Brazil, Canada, China, Germany, Puerto Rico, the United Kingdom
and Mexico which process and distribte both imported and domestic product to the operating
units. Operationally, the principal focus is on crossdocking product, while maintaining
stored inventory is minimized. During fiscal 2000, approximately 80% of the International
merchandise purchases flowed through these distribution facilities. The balance was
shipped directly to the stores from suppliers. A combination of Company owned and operated
facilities and third-party facilities comprises the overall distribution structure for
International logistics.

Page 9 of 25 (Form 10-K)

        The sales reported in the
"Other" category included in Note 9 of Notes to Consolidated Financial
Statements incorporated by reference in Item 8 of Part II found on page 19 of this annual
report, result from sales to third parties by McLane Company, Inc. (McLane). McLane is a
wholly-owned wholesale distributor that sells its merchandise to a variety of retailers,
primarily in the convenience store industry. McLane also services Wal-Mart discount
stores, Supercenters and SAM’S Clubs. Sales to third parties for the three fiscal
years ended January 31, 2000, 1999 and 1998 were $8,763,000,000, $7,111,000,000 and
$5,953,000,000 respectively. McLane offers a wide variety of grocery and non-grocery
products, including perishable and non-perishable items. The non-grocery products consist
primarily of tobacco products, general merchandise, health and beauty aids, toys and
stationery.

        During fiscal 2000, McLane
divested its food distribution centers and constructed one new grocery distribution center
leaving 16 distribution centers from which its customers, including the Company, are
served. The distribution centers are located in the continental United States with two
located in each of California and Texas, and one each in Arizona, Alabama, Colorado,
Florida, Georgia, Illinois, Kentucky, Mississippi, New York, North Carolina, Virginia and
Washington.

As of January 31, 2000, the Company employed approximately 1,140,000
associates worldwide, with approximately 885,000 in the United States and 255,000
internationally. Most associates participate in incentive programs, which provide the
opportunity to receive additional compensation based upon the Company’s productivity
or profitability.

Page 10 of 25 (Form 10-K)

(1) Wal-Mart discount store locations relocated or expanded as Wal-Mart
Supercenters.

(2) Total opened net of conversions of Wal-Mart discount stores to Wal-Mart
Supercenters

Page 11 of 25 (Form 10-K)

Page 12 of 25 (Form 10-K)

* At January 31, 2000, includes 36 Aurreras (combination stores), 68 Bodegas (discount
stores), 51 Suburbias (specialty department stores), 38 Superamas (traditional
supermarkets), and 204 Vips (restaurants).

Page 13 of 25 (Form 10-K)

ITEM 2. PROPERTIES

        The number and location of
domestic and international Wal-Mart discount stores, Supercenters and SAM’S Clubs is
incorporated by reference to the table under the caption "Fiscal 2000 End of Year
Store Counts" on page 6 of the Annual Report to Shareholders for the year ended
January 31, 2000.

        The Company owns 1,352 of
the properties on which domestic discount stores and Supercenters are located and 295 of
the properties on which domestic SAM’S Clubs are located. In some cases, the Company
owns the land associated with leased buildings. New buildings, both leased and owned, are
constructed by independent contractors.

        The remaining buildings in
which its present domestic locations are located are either leased from a commercial
property developer, leased pursuant to a sale/leaseback arrangement or leased from a local
governmental entity through an industrial revenue bond transaction. All of the
Company’s leases for its stores provide for fixed annual rentals and, in many cases,
the leases provide for additional rent based on sales volume.

        Domestically, the Company
operated 45 Wal-Mart distribution facilities and 16 McLane distribution facilities as of
January 31, 2000. These distribution facilities are primarily owned by the Company, and
several are subject to mortgages granted to secure loans. Some of the distribution
facilities are leased under industrial development bond financing arrangements and provide
the option of purchasing these facilities at the end of the lease term for nominal
amounts.

        The Company owns office
facilities in Bentonville, Arkansas that serve as the home office for the Company and an
office facility in Temple, Texas which serves as the home office for McLane.

        Internationally, the Company
has a combination of owned and leased properties in each country in which the operating
units are located. The Company owns seven properties in Argentina, nine properties in
Brazil, 11 properties in Canada, one property in China through joint venture, 19
properties in Germany, five properties in Korea, 186 properties in Mexico, two properties
in Puerto Rico  and 83 properties in the Undited Kingdom in which the operating units
are located, with the remaining units in each country being leased.

        The Company utilizes both
owned and leased properties for office facilities in each country in which it conducts
business.

ITEM 3. LEGAL PROCEEDINGS

        The Company is not a party
to any material pending legal proceedings. Neither the Company nor any of its properties
is subject to any material pending legal proceeding, other than routine litigation
incidental to the Company’s business.

Page 15 of 25 (Form 10-K)

        The Company recently opened
a Supercenter in Honesdale, Pennsylvania. In February of 1999, the Company settled claims
made by the Pennsylvania Department of Environmental Protection (PDEP) that a
subcontractor’s acts and omissions relating to the construction of the Supercenter
led to excess erosion and sedimentation of a nearby creek. In the settlement, Wal-Mart
agreed to pay a fine of $25,000 and to perform a $75,000 community environmental project
in the Honesdale area. The Company is negotiating settlement of a claim by the United
States Army Corps of Engineers that the construction resulted in the filling of
approximately 0.76 acres in excess of the permitted fill area of waters and wetlands at
the site. The proposed settlement with the Corps will require Wal-Mart to pay $200,000 to
a non-profit corporation for the purchase of local wetlands conservation areas and
easements. The Company has been reimbursed for these amounts by the contractor on the
project.

        The United States
Environmental Protection Agency (EPA) is threatening to bring suit against the Company and
five of its contractors over alleged violations of a 1992 storm water permit issued with
respect to various Wal-Mart development sites in Texas, New Mexico and Oklahoma. The EPA
has presented the Company with penalty calculations of $5.6 million.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS

        No matters were submitted to
a vote of the Company’s security holders during the last quarter of the year ended
January 31, 2000.

ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT

        The following information is
furnished with respect to each of the executive officers of the Company, each of whom is
elected by and serves at the pleasure of the Board of Directors. The business experience
shown for each officer has been his principal occupation for at least the past five years.

Page 16 and 17 (Form 10-K)

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY


        AND RELATED SHAREHOLDER MATTERS

        The information required by
this item is incorporated by reference to the information "Number of
Shareholders" under the caption "11-Year Financial Summary" on pages 18 and
19, and all the information under the captions "Market Price of Common Stock",
"Listings - Stock Symbol: WMT" and "Dividends Paid Per Share" on page
41 of the Annual Report to Shareholders for the year ended January 31, 2000.

ITEM 6. SELECTED FINANCIAL DATA

        The information required by
this item is incorporated by reference to all information under the caption "11-Year
Financial Summary" on pages 18 and 19 of the Annual Report to Shareholders for the
year ended January 31, 2000.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL

        CONDITION AND RESULTS OF OPERATIONS

        The information required by
this item is furnished by incorporation by reference to all information under the caption
"Management’s Discussion and Analysis" on pages 20 through 25 of the Annual
Report to Shareholders for the year ended January 31, 2000.

ITEM 7a. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT
MARKET RISK

        The information required by
this item is furnished by incorporation by reference to all information under the
sub-caption "Market Risk" of the caption "Management’s Discussion and
Analysis" on pages 21 through 24 of the Annual

Page 18 of 25 (Form 10-K)

Report to Shareholders for the year ended January 31, 2000.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

        The information required by
this item is furnished by incorporation by reference to all information under the captions
"Consolidated Statements of Income", "Consolidated Balance Sheets",
"Consolidated Statements of Shareholders’ Equity", "Consolidated
Statements of Cash Flows", "Notes to Consolidated Financial Statements" and
"Report of Independent Auditors" on pages 26 through 40 of the Annual Report to
Shareholders for the year ended January 31, 2000.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON


        ACCOUNTING AND FINANCIAL DISCLOSURE

        None.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE
REGISTRANT

        Information required by this
item with respect to the Company’s directors and compliance by the Company’s
directors, executive officers and certain beneficial owners of the Company’s Common
Stock with Section 16(a) of the Securities Exchange Act of 1934 is furnished by
incorporation by reference to all information under the captions entitled "Nominees
for Directors" on pages 2 through 4 and "Section 16(a) Beneficial Ownership
Reporting Compliance" on page 15 of the Company’s definitive Proxy Statement for
its Annual Meeting of Shareholders to be held on Friday, June 2, 2000 (the "Proxy
Statement"). The information required by this item with respect to the Company’s
executive officers is included as Item 4A of Part I found on pages 16 through 18 of this
annual report.

ITEM 11. EXECUTIVE COMPENSATION

        The information required by
this item is furnished by incorporation by reference to all information under the caption
entitled "Compensation of Directors" on page 4, "Compensation and
Nominating Committee Report on Executive Compensation" on pages 6 through 9, and
"Summary Compensation", "Option Grants In Last Fiscal Year", and
"Option Exercises and Fiscal Year End Option Values" on pages 10 through 12 of
the Proxy Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT

        The information required by
this item is furnished by incorporation by reference to all information under the caption
entitled "Stock Ownership", subcaptions "Ownership of Major
Shareholders" and "Holdings of Officers and Directors" on pages 13 through
15 of the Proxy Statement.

Page 19 of 25 (Form 10-K)

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

        The information required by
this item is furnished by incorporation by reference to all information under the caption
"Related-Party Transactions with Wal-Mart" on page 6 of the Proxy Statement.

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES,

         AND REPORTS ON FORM 8-K

(a) 1. & 2. Consolidated Financial Statements

The financial statements listed in the Index to Consolidated Financial
Statements, which appears on page 23 of this annual report, are incorporated by reference
herein or filed as part of this Form 10-K.

    3.   Exhibits

The following documents are filed as exhibits to this Form 10-K:

Page 20 of 25 (Form 10-K)

     Page 21 of 25 (Form 10-K)

*Filed herewith as an Exhibit.

+Management contract or compensatory plan or arrangement.

(b) Reports on Form 8-K

Page 22 of 25 (Form 10-K)

All schedules have been omitted because the required information is not
present or is not present in amounts sufficient to require submission of the schedule, or
because the information required is included in the financial statements, including the
notes thereto.

Page 23 of 25 (Form 10-K)

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

        Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated:

Page 25 of 25 (Form 10-K)