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 1, 2000

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

Commission File Number 1-7724

SNAP-ON INCORPORATED
(Exact name of registrant as specified in its charter)

Delaware 39-0622040
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

10801 Corporate Drive, Pleasant Prairie, Wisconsin 53158-1603
- -------------------------------------------------- ----------
(Address of principal executive offices) (Zip code)

Registrant's telephone number, including area code: (262) 656-5200

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

Title of each class Name of exchange on which registered
- ------------------------------- ------------------------------------
Common stock, $1 par value New York Stock Exchange
Preferred stock purchase rights 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, 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 a definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]

Aggregate market value of voting stock held by non-affiliates of the registrant
at February 28, 2000: $1,309,772,474

Number of shares outstanding of each of the registrant's classes of common stock
at February 28, 2000: Common stock, $1 par value, 58,551,912 shares

Documents incorporated by reference
Portions of the Corporation's Annual Report to Shareholders for the fiscal year
ended January 1, 2000, are incorporated by reference into Parts I, II and IV of
this report.

Portions of the Corporation's Proxy Statement, dated March 28, 2000, prepared
for the Annual Meeting of Shareholders scheduled for April 28, 2000, are
incorporated by reference into Part III of this report.

TABLE OF CONTENTS
Page
----
PART I
Item 1. Business.........................................................3
Item 2. Properties.......................................................9
Item 3. Legal Proceedings...............................................10
Item 4. Submission of Matters to a Vote of Security Holders.............10

PART II
Item 5. Market for Registrant's Common Equity and
Related Stockholder Matters...................................12
Item 6. Selected Financial Data.........................................12
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations...........................12
Item 7A. Qualitative and Quantitative Disclosures About
Market Risk...................................................12
Item 8. Financial Statements and Supplementary Data.....................13
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure...........................13

PART III
Item 10. Directors and Executive Officers of the Registrant..............13
Item 11. Executive Compensation..........................................13
Item 12. Security Ownership of Certain Beneficial Owners
and Management................................................13
Item 13. Certain Relationships and Related Transactions..................13

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

Signature Pages...............................................................15
Exhibit Index.................................................................17

PART I

Item 1: Business

Snap-on Incorporated (the "Corporation" or "Snap-on") was incorporated under the
laws of the state of Wisconsin in 1920 and reincorporated under the laws of the
state of Delaware in 1930. Snap-on's mission is to delight its customers by
providing productivity-enhancing, innovative products, services and solutions.
Snap-on is a leading global developer, manufacturer and marketer of professional
tools, diagnostics equipment and related services marketed in more than 150
countries. Long known as a quality and performance leader in professional tools
and tool storage, Snap-on offers a wide range of capabilities and solutions for
professional tool users in vehicle service, industrial and other commercial
applications worldwide. The Corporation's largest geographic markets include the
United States, Australia, Brazil, Canada, France, Germany, Japan, Mexico, the
Netherlands, Spain, Sweden and the United Kingdom. Customers include
professional vehicle service technicians, independent automotive repair and body
shops, franchised service centers, specialty repair shops, automotive
dealerships, vehicle manufacturers, government, and industrial and commercial
tool and equipment users worldwide. The originator of the dealer van
distribution channel, Snap-on also reaches its customers through company direct
and distributor channels where appropriate.

The Corporation's segments are based on the organization structure that is used
by management for making operating and investment decisions, and for assessing
performance. Based on this management approach, the Corporation has two
reportable segments: Global Transportation and Global Operations. The Global
Transportation segment consists of the Corporation's business operations serving
the dealer van channel worldwide. The Global Operations segment consists of the
business operations serving the direct sales and distributor channels worldwide.
These two segments derive revenues primarily from the sale of tools and
equipment. Additional information about the Corporation's business segments,
customers, domestic and international operations and products and services is
provided in Note 15 entitled "Segments" on pages 42 and 43 of the Corporation's
1999 Annual Report, incorporated herein by reference.

During 1999, the Corporation acquired the Sandvik Saws and Tools business, now
operating as the Bahco Group AB ("Bahco"), three other new business operations
and the remaining 40% interest in Mitchell Repair Information Company, LLC
("MRIC"). Each of the acquisitions provides the Corporation with a complementary
product line, new customer relationships, access to additional distribution
and/or extended geographic reach. Bahco is a manufacturer and supplier of
professional tool products and employs approximately 2,400 people. Of those,
approximately 1,000 employees are in Sweden. Products are manufactured at 11
plants in Sweden, the United States, Argentina, England, France, Germany and
Portugal. MRIC is a major provider of print and electronic versions of vehicle
mechanical and electrical repair information and of shop management software to
repair and service establishments throughout North America. In the fourth
quarter of 1999, the Corporation sold a 15% interest in MRIC to Genuine Parts
Company and entered into a strategic alliance to enhance and expand the
e-business efforts of both companies. The combined effort unites the electronic,
online replacement parts ordering capabilities of Genuine Parts Automotive Parts
Group with the online repair information capabilities of MRIC.

In 1998, the Corporation's board of directors approved Project Simplify, a broad
program of internal rationalizations, consolidations and reorganizations to make
the Corporation's business operations simpler and more effective. Project
Simplify was essentially completed and fully provided for as of January 1, 2000.
Additional information regarding Project Simplify can be found on pages 20 and
21, Management's Discussion and Analysis, and in Note 14 entitled
"Restructuring" on pages 41 and 42 of the Corporation's 1999 Annual Report,
incorporated herein by reference.

Products and Services

The Corporation derives income from the manufacture, marketing and distribution
of its products and related services. Income is also derived from the financing
of certain of the Corporation's products, primarily through a 50%-owned joint
venture. The Corporation's two reportable business segments offer a broad line
of products and complementary services which can be divided into two groups:
tools and equipment. The following table shows the approximate percentage of
consolidated sales for each of these product groups in each of the past three
years.

Product Group % of Sales
1999 1998 1997
---- ---- ----
Tools 59% 52% 55%
Equipment 41% 48% 45%
---- ---- ----
100% 100% 100%

The tools product group includes hand tools, power tools and tool storage
products. Hand tools include wrenches, screwdrivers, sockets, pliers, ratchets,
saws and cutting tools, pruning tools and other similar products. Power tools
include pneumatic (air), cord-free (battery) and corded (electric) tools such as
impact wrenches, ratchets, chisels, drills, sanders, polishers and similar
products. Tool storage units include tool chests, roll cabinets and other
similar products. The majority of products are manufactured by Snap-on and in
completing the product line, some items are purchased from external
manufacturers.

The equipment product group includes hardware and software solutions for the
diagnosis and service of automotive and industrial equipment. Products include
engine analyzers, air conditioning service equipment, brake service equipment,
wheel balancing and alignment equipment, transmission troubleshooting equipment,
vehicle emissions and safety testing equipment, battery chargers, lifts and
hoists, diagnostics equipment service and collision repair equipment. Also
included are service and repair information products, online diagnostics
services, management systems, point-of-sale systems, integrated systems for
vehicle repair shops, and purchasing facilitation services. In the United
States, the Corporation supports the sale of its diagnostics and shop equipment
by offering training programs. These programs offer certification in both
specific automotive technologies and in the application of specific diagnostics
equipment developed and marketed by the Corporation.

Tools and equipment are marketed under a number of brand names and trademarks,
many of which are well known in the vehicle service and industrial markets
served. Some of the major trade names and trademarks and the products and
services with which they are associated include the following:

Trademarks Products and Services
---------- ---------------------

Snap-on Hand tools, power tools, tool storage units, and
certain equipment

Blue-Point Hand tools, power tools, tool storage units

Acesa Hand tools

Bahco Hand tools

Fish & Hook Hand tools

Irimo Hand tools

Lindstrom Hand tools

Palmera Hand tools

Pradines Hand tools

Sandflex Hand tools

Williams Hand tools

ATI Tools and equipment for aerospace and industrial
applications

Sioux Power tools

Sun Diagnostics and service equipment

Balco Engine diagnostics

White Equipment to recover, recycle and recharge
refrigerant in vehicle air-conditioning systems
and other fluid handling equipment

John Bean Under-car and other service equipment

Wheeltronic ltd. Hoists and lifts for vehicle service shops

Texo Sollevatori Hoists and lifts for vehicle service shops

Hofmann Wheel balancers, lifts, tire changers and aligners

GS Wheel service equipment

Brewco Collision repair equipment

Hein-Werner Collision repair equipment

Blackhawk Collision repair equipment

Mitchell Repair Repair and service information and shop management
systems

ShopKey Repair and service information and shop management
systems

EquiServe Diagnostic equipment service

Snap-on Credit LLC ("the LLC"), a joint venture with Newcourt Financial USA Inc.
("Newcourt"), an affiliate of CIT Group, offers credit programs that facilitate
the sale of many of the Corporation's products and services. On January 3, 1999,
the Corporation established the LLC to provide financial services to the
Corporation's global dealer and customer networks. The LLC joint venture is 50%
owned by the Corporation and 50% owned by Newcourt. The joint venture operations
were established initially in the United States and will be expanded globally.
As a result of the establishment of the joint venture, the Corporation
effectively outsourced to the LLC its captive credit function, previously
managed by the Corporation's wholly owned subsidiary, Snap-on Credit
Corporation. Additional information about the LLC is provided in Note 5 entitled
"Receivables" on page 33 of the Corporation's 1999 Annual Report, incorporated
herein by reference.

Through contracts, extended credit is offered to technicians to enable them to
purchase tools and equipment that can be used to generate income while they pay
for the products over time. Financing, in a lease format, is also offered to
shop owners, both independent and national chains, who purchase equipment items,
which typically are higher-price-point products than tools. The duration of
lease contracts is often two-to-three times that of extended credit contracts.

Financing is also made available to new dealers, whereby a 10-year loan is
originated to enable the dealer to fund the purchase of the franchise and the
related working capital needs, primarily inventory and customer receivables.

Currently, the majority of the finance income is derived from the vehicle
service industry in North America. Internationally, the Corporation continues to
directly provide financing to its dealer and customer network.

Market Sectors Served

The Corporation markets and distributes its products and related services
principally to professional tool and equipment users around the world. The
largest two market sectors are the vehicle service and repair sector, and the
industrial sector.

Vehicle Service and Repair Sector

The vehicle service and repair sector has three main customer groups:
professional technicians, who purchase tools and equipment for themselves;
service and repair shop owners and managers -- including independent shops,
national chains and automotive dealerships, who purchase equipment for use by
multiple technicians within a service or repair facility; and vehicle
manufacturers.

The Corporation provides innovative tool and equipment solutions, as well as
technical sales support and training, to meet technicians' evolving needs.
Snap-on's dealer van distribution system offers technicians the convenience of
purchasing quality tools with minimal disruption of their work routine. The
Corporation also serves owners and managers of shops where technicians work with
tools, diagnostics equipment, repair and service information, and shop
management products. Snap-on provides vehicle manufacturers products and
services including tools, facilitation services for the purchase and
distribution of equipment, and consulting services.

Major challenges for the Corporation and the vehicle service and repair industry
include the increasing rate of technological change within motor vehicles and
the resulting impact on the businesses of both suppliers and customers that is
necessitated by such change.

Industrial Sector

The Corporation markets its products to a wide variety of industrial customers,
including industrial maintenance and repair facilities; manufacturing and
assembly operations; government facilities; schools; and original equipment
manufacturers ("OEMs") that require instrumentation or service tools and
equipment for their products.

Major challenges in the industrial sector include a highly competitive,
cost-conscious environment, and a trend toward customers making all of their
tool purchases through one integrated supplier. The Corporation believes it is
currently a meaningful participant in the market sector for industrial tools and
equipment.

Distribution Channels

The Corporation serves customers primarily through three channels of
distribution: dealer/tech reps, company direct sales, and distributors. The
following discussion represents the Corporation's general approach in each
channel, and is not intended to be all-inclusive.

Dealer/Tech Rep Organization

In the United States, the majority of sales to the vehicle repair industry are
conducted through the Corporation's dealer network and its tech rep system.
Snap-on's mobile dealer van system ("Dealers") primarily covers vehicle service
technicians and shop owners, providing weekly contact at the customer's place of
business. Dealers' sales are concentrated in hand and power tools, tool storage
units and small diagnostic and shop equipment, which can easily be transported
in a van and demonstrated during a brief sales call. Dealers purchase the
Corporation's products at a discount from suggested retail prices and resell
them at prices of the dealer's choosing. Although some dealers have sales areas
defined by other methods, most U.S. Dealers are provided a list of places of
business which serves as the basis of the dealer's sales route.

Since 1991, all new U.S. Dealers, and a majority of existing U.S. Dealers, have
been enrolled as franchisees of the Corporation. The Corporation currently
charges initial and ongoing monthly license fees, which do not add materially to
the Corporation's revenues. The Corporation makes it possible for prospective
Dealer candidates to work as employee sales representatives, at salary plus
commission, prior to making an investment in a franchise. In addition, through
the LLC, financial assistance is provided to newly converted franchised dealers
and other new franchise Dealers, which could include financing for initial
license fees, inventory, revolving accounts receivable acquisition, equipment,
fixtures, other

expenses and an initial checking account deposit. At year-end 1999,
approximately 90% of all U.S. Dealers were enrolled as franchisees versus
approximately 89% for 1998.

The Corporation services and supports its dealers with an extensive field
organization of branch offices and service and distribution centers. The
Corporation also provides sales training, customer and Dealer financial
assistance, and marketing and product promotion programs to strengthen dealer
sales. A National Dealer Advisory Council, composed of and elected by dealers,
assists the Corporation in identifying and implementing enhancements to the
franchise program.

In the United States, Dealers are supported by the Snap-on/Sun tech rep system
employee sales force. Tech reps are specialists who demonstrate and sell
higher-price-point diagnostics and shop equipment, as well as shop management
information systems. Tech reps work independently and with Dealers to identify
and generate sales leads among vehicle service shop owners. Tech reps are
compensated primarily on the basis of commission; Dealers receive a brokerage
fee from certain sales made by the Tech Specialists to the Dealer's customers.

Most products sold through the Dealer/tech rep organization are sold under the
Snap-on or Sun brand names.

The Corporation has replicated its Dealer van method of distribution in certain
countries, including Australia, Canada, Germany, Mexico, Benelux Countries,
South Africa, Japan and the United Kingdom. In many of these markets, as in the
United States, purchase decisions are generally made or influenced by
professional vehicle service technicians and shop owners. The Corporation
markets products in certain other countries through its subsidiary, Snap-on
Tools International, Ltd., which sells to foreign distributors under license or
contract with the Corporation.

Company Direct Sales

In the United States, a growing proportion of sales of Sun and other Snap-on
branded shop equipment, including John Bean, Wheeltronic, White and Hoffmann,
are made by a direct sales force that has responsibility for national accounts.
As the automotive service and repair industry consolidates (with more business
conducted by national chains, automotive dealerships and franchised service
centers) these larger organizations can be serviced most effectively by sales
people who can demonstrate and sell the full line of products and services. The
Corporation also sells its products and services directly to vehicle
manufacturers.

Tools and equipment are marketed to industrial and governmental customers in the
United States through industrial sales representatives, who are employees, and
independent industrial distributors. In most markets outside the United States,
industrial sales are conducted through distributors. The sales representatives
focus on industrial customers whose main purchase criteria are quality and
service, as well as on certain OEM accounts. At the end of 1999, the Corporation
had industrial sales representatives in the United States, Australia, Canada,
Japan, Mexico, Puerto Rico, and some European countries, with the United States
representing the majority of the Corporation's total industrial sales.

Distributors

Sales of certain tools and equipment are made through vehicle service and
industrial distributors, who purchase the items from Snap-on and resell them to
the end users. Products supplied by Bahco, under the Bahco, Sandflex, Fish &
Hook, Pradines and Lindstrom brands and trade names, for example, are sold
through distributors in Europe, North and South America, Asia and certain other
parts of the world. Under-car and other vehicle service equipment, sold through
distributors primarily under brands including John Bean and Hofmann, as well as
hand tools under brands including Irimo, Palmera and Acesa, are differentiated
from those products sold through the dealer/tech rep and direct sales channels.
Sun brand equipment is marketed through distributors in South America and Asia,
and through both a direct sales force and distributors in Europe. In addition,
through its J.H. Williams division, the Corporation manufactures specially
designed products for Lowe's Companies Inc. under the Lowe's brand name, known
as Kobalt(TM) which are marketed in more than 500 Lowe's outlets.

E-commerce

Snap-on's e-commerce development initiatives are expected to allow Snap-on to
match the capabilities of the Internet with Snap-on's existing brand sales and
distribution strengths and to reach new customer segments. These initiatives are
being designed to further leverage the one-on-one relationships and service
Snap-on currently has with its customers. With

business-to-business and business-to-consumer capabilities, the Corporation and
its dealers will be enlarging communications with customers on a real-time,
24-hour, 7-days a week basis.

Competition

The Corporation competes on the basis of its product quality, service, brand
awareness and technological innovation. While no one company competes with the
Corporation across all of its product lines and distribution channels, various
companies compete in one or more product categories and/or distribution
channels.

The Corporation believes that it is a leading manufacturer and distributor of
its products for the customers it serves in the vehicle service industry, and
that it offers the broadest line of products to the vehicle service industry.
The major competitors selling to professional technicians in the vehicle service
and repair sector through the mobile van channel include MAC Tools (The Stanley
Works) and Matco (Danaher Corporation). The Corporation also competes with
companies that sell through non-mobile van distributors; these competitors
include Facom (Fimalac), Sears, Roebuck and Co., and The Stanley Works. In the
industrial sector, major competitors include Armstrong (Danaher Corporation),
Cooper Industries, Inc. and Proto (The Stanley Works). The major competitors
selling diagnostics and shop equipment to shop owners in the vehicle service and
repair sector include Corghi S.p.A., Facom (Fimalac), Hennessy (Danaher
Corporation), Hunter Engineering, SPX Corporation and Pentair, Inc.

Raw Materials and Purchased Product

The Corporation's supply of raw materials (including primarily various grades
and alloys of steel bars and sheets) and purchased components are readily
available from numerous suppliers.

The majority of 1999 consolidated net sales consisted of products manufactured
by the Corporation. The remainder was purchased from outside suppliers. No
single supplier's products accounted for a material portion of 1999 consolidated
net sales.

Patents and Trademarks

The Corporation vigorously pursues and relies on patent protection to protect
its inventions and its position in its markets. As of January 1, 2000, the
Corporation and its subsidiaries held 947 patents worldwide, with another 650
pending patent applications. No sales relating to any single patent represented
a material portion of the Corporation's revenues in 1999.

Examples of products that have features or designs that benefit from patent
protection include engine analyzers, serrated jaw open-end wrenches, wheel
alignment systems, wheel balancers, sealed ratchets, electronic torque wrenches,
ratcheting screwdrivers, emissions-sensing devices and air conditioning
equipment.

Much of the technology used in the manufacturing of vehicle service tools and
equipment is in the public domain. The Corporation relies primarily on trade
secret protection to protect proprietary processes used in manufacturing.
Methods and processes are patented when appropriate.

Trademarks used by the Corporation are of continuing importance to the
Corporation in the marketplace. Trademarks have been registered in the United
States and 78 other countries, and additional applications for trademark
registrations are pending. The Corporation vigorously polices proper use of its
trademarks.

The Corporation's right to manufacture and sell certain products is dependent
upon licenses from others. These products do not represent a material portion of
the Corporation's sales.

Working Capital

Because most of the Corporation's business is not seasonal, and its inventory
needs are relatively constant, no unusual working capital needs arise during the
year.

The Corporation's use of working capital is discussed in "Management's
Discussion and Analysis of Results of Operations and Financial Condition," on
pages 22 and 23 of the Corporation's 1999 Annual Report and is incorporated
herein by reference.

The Corporation does not depend on any single customer, small group of customers
or government for any material part of its sales, and has no significant backlog
of orders.

Environment

The Corporation complies with applicable environmental control requirements in
its operations. Compliance has not had, and the Corporation does not for the
foreseeable future expect it to have, a material effect upon the Corporation's
capital expenditures, earnings or competitive position.

Employees

At the end of 1999, the Corporation employed approximately 14,000 people, of
whom approximately 36% are engaged in manufacturing activities.

Item 2: Properties

The Corporation maintains both leased and owned manufacturing, warehouse
distribution and office facilities throughout the world. The Corporation
believes that its facilities are well maintained and have a capacity adequate to
meet the Corporation's present and foreseeable future demand. The Corporation's
United States facilities occupy approximately 4.7 million square feet, of which
approximately 74 % is owned. The Corporation's facilities outside the United
States contain approximately 4.5 million square feet, of which approximately 66
percent is owned. Included are the Corporation's owned corporate and general
offices located in Pleasant Prairie, Wisconsin and Kenosha, Wisconsin,
respectively.

The Corporation's principal manufacturing locations and distribution centers are
as follows:

Location Type of property Owned/Leased
- ---------------------------- ---------------- ------------
Conway, Arkansas Manufacturing Owned
City of Industry, California Manufacturing Leased
Escondido, California Manufacturing Owned
San Jose, California Manufacturing Leased
Columbus, Georgia Manufacturing Owned

Crystal Lake, Illinois Distribution Owned
Mt. Carmel, Illinois Manufacturing Owned
Algona, Iowa Manufacturing Owned
Sioux City, Iowa Manufacturing Owned
Olive Branch, Mississippi Distribution Leased and owned

Carson City, Nevada Distribution Leased and owned
Robesonia, Pennsylvania Distribution Owned
Poway, California Distribution and Leased
manufacturing
Elizabethton, Tennessee Manufacturing Owned
Johnson City, Tennessee Manufacturing Owned

Milan, Tennessee Manufacturing Owned
Baraboo, Wisconsin Manufacturing Leased
East Troy, Wisconsin Manufacturing Owned
Elkhorn, Wisconsin Manufacturing Owned
Kenosha, Wisconsin Manufacturing Owned

Milwaukee, Wisconsin Manufacturing Owned
Santo Tome, Argentina Manufacturing Owned
Barbara D'oeste, Brazil Manufacturing Owned
Mississauga, Canada Manufacturing Leased
Newmarket, Canada Distribution and Owned
manufacturing

Kettering, England Distribution Owned
Rotherham, England Manufacturing Leased
King's Lynn England Distribution and Owned
manufacturing
Pfungstadt, Germany Manufacturing Leased
Unterneukirchen, Germany Manufacturing Leased

Wuppertal, Germany Manufacturing Leased
Sopron, Hungary Manufacturing Owned
Correggio, Italy Manufacturing Owned
Helmond, Netherlands Distribution Owned
Veenendaal, Netherlands Distribution Leased

Vila do Conde, Portugal Manufacturing Owned
Irun, Spain Manufacturing Owned
Urretxu, Spain Manufacturing Owned
Vitoria, Spain Distribution and Owned
manufacturing
Bollnas, Sweden Manufacturing Owned

Edsbyn, Sweden Manufacturing Owned
Enkoping, Sweden Manufacturing Owned
Lidkoping, Sweden Manufacturing Owned
Sandviken, Sweden Distribution Leased

Item 3: Legal Proceedings

During 1999, the Corporation settled litigation involving Tejas Testing
Technology One, L.C. and Tejas Testing Technology Two, L.C. The Corporation is
involved in a suit with SPX Corporation. Further information is described in
Note 13 entitled "Commitments and Contingencies" to the Financial Statements of
the Corporation on pages 40 and 41 of its 1999 Annual Report, which is
incorporated herein by reference.

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

There was no matter submitted to a vote of the shareholders during the fourth
quarter of the fiscal year ending January 1, 2000.

Executive Officers of the Registrant

The executive officers of the Corporation, their ages as of January 1, 2000, and
their current titles and positions held during the last five years are listed
below.

Robert A. Cornog (59) - Chairman, President and Chief Executive Officer since
July 1991. A Director since 1982.

Branko M. Beronja (65) - Executive Vice President since October 1998. Senior
Vice President - Diagnostics from February 1998 to October 1998. Senior Vice
President - Diagnostics, North America from April 1996 to February 1998.
President North American Operations from April 1994 to April 1996, and Vice
President - Sales, North America from August 1989 to April 1994. A Director
since January 1997.

Frederick D. Hay (55) - Senior Vice President - Operations since October 1998.
Senior Vice President - Transportation from February 1996 to October 1998. Prior
to joining Snap-on, he was President of the Interior Systems and Components
Division of UT Automotive, a business unit of United Technologies Corporation,
from December 1989 to January 1996.

Donald S. Huml (53) - Senior Vice President - Finance and Chief Financial
Officer since August 1994. Prior to joining Snap-on, he was Vice President and
Chief Financial Officer of Saint-Gobain Corporation from December 1990 to August
1994.

Michael F. Montemurro (51) - Senior Vice President - Transportation since
October 1998. Senior Vice President Financial Services and Administration from
August 1994 to October 1998. Senior Vice President - Financial Services,
Administration and Chief Financial Officer from April 1994 to August 1994.
Senior Vice President - Finance and Chief Financial Officer from March 1990 to
April 1994.

Neil T. Smith (45) - Controller since November 1997. Financial Controller from
June 1997 to November 1997. Director of Financial Analysis and Planning from
December 1994 to May 1997. Prior to joining Snap-on, he was Director of Finance
for the Nielsen Marketing Research Division of Dun and Bradstreet Corporation
from January 1991 to December 1994.

Susan F. Marrinan (51) - Vice President, Secretary and General Counsel since
January 1992.

There is no family relationship among the executive officers and there has been
no involvement in legal proceedings during the past five years that would be
material to the evaluation of the ability or integrity of any of the executive
officers. Executive officers may be elected by the board of directors or
appointed by the Chief Executive Officer at the regular meeting of the board of
directors which follows the Annual Shareholders' Meeting, held on the fourth
Friday of April each year, and at such other times as new positions are created
or vacancies must be filled.

PART II

Item 5: Market for Registrant's Common Equity and Related Stockholder Matters

Since 1995, the Corporation has undertaken stock repurchases from time to time
to prevent dilution created by shares issued for employee and dealer stock
purchase plans, stock options and other corporate purposes, as well as to
repurchase shares when market conditions are favorable. At its January 1999
meeting, the board of directors authorized the repurchase of up to $50.0 million
of the Corporation's common stock. This action followed the board's
authorization in 1998 to repurchase up to $100.0 million of common stock and its
authorization in 1997 for up to $100.0 million of common stock. At the end of
1999, all of the 1999 authorization and substantially all of the 1998
authorization remained available. The Corporation repurchased 492,800 shares of
its common stock in 1999, 2,279,400 shares in 1998 and 986,333 shares in 1997.
Since 1995, the Corporation has repurchased 8,570,083 shares. In 1999, the
Corporation's average common stock repurchase price was $29.83.

At January 1, 2000, the Corporation had 65,224,118 shares of common stock
outstanding. This consists of 58,546,668 shares which are considered outstanding
for purposes of computing earnings per share and an additional 6,677,450 shares
held in a Grantor Stock Trust which are considered outstanding for voting
purposes but not for purposes of computing earnings per share.

The Corporation's stock is listed on the New York Stock Exchange under the
ticker symbol SNA.

The Corporation's common stock high and low prices for the last two years by
quarter were as follows:

Common Stock High/Low Prices - Unaudited
(Amounts in dollars)

Quarter 1999 1998
- ------- ---- ----
First $36.75 - $28.06 $46.22 - $37.19
Second $37.44 - $28.56 $46.44 - $34.38
Third $37.81 - $30.75 $37.50 - $25.50
Fourth $32.50 - $26.44 $36.00 - $28.88

Additional information required by Item 5 is contained in the sections entitled
"Quarterly Financial Information" and "Six-year Data" on pages 44 and 45 of the
Corporation's 1999 Annual Report and is incorporated herein by reference.

Item 6: Selected Financial Data

The information required by Item 6 is contained in the section entitled
"Six-year Data" on page 45 of the Corporation's 1999 Annual Report and is
incorporated herein by reference.

Item 7: Management's Discussion and Analysis of Financial Condition and
Results of Operations

The information required by Item 7 is contained in the section entitled
"Management's Discussion and Analysis of Results of Operations and Financial
Condition" on pages 17 through 25 of the Corporation's 1999 Annual Report and is
incorporated herein by reference.

Item 7A: Qualitative and Quantitative Disclosures About Market Risk

The information required by Item 7A is contained in the section entitled "Value
at Risk" on page 24 and in Note 8 entitled "Financial Instruments" on pages 35
and 36 of the Corporation's 1999 Annual Report and is incorporated herein by
reference.

Item 8: Financial Statements and Supplementary Data

Financial statements and supplementary data required by Item 8 is contained in
the Corporation's 1999 Annual Report appearing in the sections entitled
"Consolidated Statement of Earnings" on page 26, "Consolidated Balance Sheets"
on page 27, "Consolidated Statements of Shareholders' Equity and Comprehensive
Income" on page 28, "Consolidated Statements of Cash Flows" on page 29, "Notes
to Consolidated Financial Statements" on pages 30 through 43, "Report of
Independent Public Accountants" on page 46, and "Quarterly Financial
Information" appearing on page 44, and is incorporated herein by reference.

Additionally, the Corporation's gross profit for the last two years by quarter
was as follows:

Gross Profit*
(Amounts in thousands)

Quarter 1999 1998
- ------- ---- ----
First $218,901 $211,545
Second $225,265 $204,690
Third $218,419 $151,526
Fourth $233,602 $195,553

*Gross Profit equals net sales less cost of goods sold.

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 identification of the Corporation's directors as required by Item 10 is
contained in the Corporation's Proxy Statement, dated March 28, 2000, in the
section entitled "Proposal to be Voted on: Election of Directors" on page 4 and
in the section entitled "Board of Directors-Directors Not Standing for Election"
on page 5, and is incorporated herein by reference.

With respect to information about the Corporation's executive officers, see
caption "Executive Officers of the Registrant" at the end of Part I of this
report.

The disclosure concerning Section 16(a) filing compliance pursuant to Item 405
of Regulation S-K is contained in the Corporation's Proxy Statement, dated March
28, 2000, in the section entitled "Other Information" on page 19, and is
incorporated herein by reference.

Item 11: Executive Compensation

The information required by Item 11 is contained in the Corporation's Proxy
Statement, dated March 28, 2000, in the section entitled "Executive
Compensation" on pages 15 through 18 and in the section entitled "Other
Information" on page 19 and is incorporated herein by reference.

Item 12: Security Ownership of Certain Beneficial Owners and Management

The information required by Item 12 is contained in the Corporation's Proxy
Statement, dated March 28, 2000, in the section entitled "Security Ownership of
Management and Certain Beneficial Owners" contained on pages 8 and 9, and is
incorporated herein by reference.

Item 13: Certain Relationships and Related Transactions

None.

PART IV

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

Item 14(a): Document List

1. List of Financial Statements

The following consolidated financial statements of Snap-on Incorporated, and the
Report of Independent Public Accountants thereon, contained on pages 26 through
43 and on page 46 of the Corporation's 1999 Annual Report to its shareholders
for the year ended January 1, 2000, are incorporated by reference in Item 8 of
this report:

Consolidated Balance Sheets as of January 1, 2000, and January 2, 1999.

Consolidated Statements of Earnings for the years ended January 1, 2000, January
2, 1999, and January 3, 1998.

Consolidated Statements of Shareholders' Equity and Comprehensive Income for the
years ended January 1, 2000, January 2, 1999, and January 3, 1998.

Consolidated Statements of Cash Flows for the years ended January 1, 2000,
January 2, 1999, and January 3, 1998.

Notes to Consolidated Financial Statements.

Report of Independent Public Accountants.

2. Financial Statement Schedules

The following consolidated financial statement schedules of Snap-on Incorporated
are included in Item 14(d) as a separate section of this report.

Schedule II Valuation and Qualifying Accounts and Reserves. Page 19 herein.

Report of Independent Public Accountants on Financial Statement Schedule. Page
20 herein.

Unaudited Pro forma Financial Statement Schedule of Bahco Group AB Acquisition.
Pages 21 through 24 herein.

All other schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission are inapplicable and,
therefore, have been omitted, or are included in the Corporation's 1999 Annual
Report in the Notes to Consolidated Financial Statements for the years ended
January 1, 2000, January 2, 1999, and January 3, 1998, which are incorporated by
reference in Item 8 of this report.

3. List of Exhibits

The exhibits filed with or incorporated by reference in this report are as
specified in the exhibit index under Item 14(c). Pages 17 and 18 herein.

Item 14(b): Reports on Form 8-K

During the fourth quarter of 1999, the Corporation reported on Form 8-K the
following:

Form 8-K dated September 30, 1999, its acquisition of the Bahco Group AB
under Item 2.

Form 8-K/A dated September 30, 1999, its acquisition of the Bahco Group AB
under Item 7.

Subsequent to year-end, the Corporation reported on Form 8-K/A dated September
30, 1999, additional information on its acquisition of the Bahco Group AB under
Item 7.

SIGNATURES

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

SNAP-ON INCORPORATED

By: /s/ R. A. Cornog Date: March 28, 2000
------------------------------------------------- ---------------
R. A. Cornog, Chairman of the Board of
Directors, President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons on behalf of the Corporation and in the
capacities as indicated.

/s/ R. A. Cornog Date: March 28, 2000
------------------------------------------------- ---------------
R. A. Cornog, Chairman of the Board of
Directors, President and Chief Executive Officer

/s/ D. S. Huml Date: March 28, 2000
------------------------------------------------- ---------------
D. S. Huml, Principal Financial Officer,
and Senior Vice President - Finance

/s/ N. T. Smith Date: March 28, 2000
------------------------------------------------- ---------------
N. T. Smith, Principal Accounting Officer,
and Controller

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons on behalf of the Corporation and in the
capacities as indicated.

By: /s/ B. M. Beronja Date: March 28, 2000
------------------------------------------------- ---------------
B. M. Beronja, Director

By: /s/ D. W. Brinckman Date: March 28, 2000
------------------------------------------------- ---------------
D. W. Brinckman, Director

By: /s/ B. S. Chelberg Date: March 28, 2000
------------------------------------------------- ---------------
B. S. Chelberg, Director

By: /s/ R. J. Decyk Date: March 28, 2000
------------------------------------------------- ---------------
R. J. Decyk, Director

By: /s/ L. A. Hadley Date: March 28, 2000
------------------------------------------------- ---------------
L. A. Hadley, Director

By: /s/ A. L. Kelly Date: March 28, 2000
------------------------------------------------- ---------------
A. L. Kelly, Director

By: /s/ G. W. Mead Date: March 28, 2000
------------------------------------------------- ---------------
G. W. Mead, Director

By: /s/ J. D. Michaels Date: March 28, 2000
------------------------------------------------- ---------------
J. D. Michaels, Director

By: /s/ E. H. Rensi Date: March 28, 2000
------------------------------------------------- ---------------
E. H. Rensi, Director

By: /s/ R. F. Teerlink Date: March 28, 2000
------------------------------------------------- ---------------
R. F. Teerlink, Director

EXHIBIT INDEX

Item 14(c): Exhibits

(2) (a) Share Purchase Agreement between CTT Cutting Tool Technology B.V.
and the Corporation dated as of April 16, 1999 (incorporated by
reference to Exhibit (2)(a) to the Corporation's report on Form 8-K
dated September 30, 1999 (Commission File No. 1-7724))

(b) Amendment Agreement #1 to Share Purchase Agreement between CTT Cutting
Tool Technology B.V. and the Corporation dated as of September 30,
1999 (incorporated by reference to Exhibit (2)(a) to the Corporation's
report on Form 8-K dated September 30, 1999 (Commission File No.
1-7724))

(3) (a) Restated Certificate of Incorporation of the Corporation as
amended through April 25, 1997 (incorporated by reference to Exhibit
(3)(a) to the Corporation's Annual Report on Form 10-K for the fiscal
year ended January 2, 1998 (Commission File No. 1-7724))

(b) Bylaws of the Corporation, effective as of January 26, 1996
(incorporated by reference to Exhibit (3)(b) to the Corporation's
Annual Report on Form 10-K for the fiscal year ended December 30, 1996
(Commission File No. 1-7724))

(4) (a) Rights Agreement between the Corporation and First Chicago Trust
Company of New York, effective as of August 22, 1997 (incorporated by
reference to the Corporation's Form 8-A12B dated October 17, 1997
(Commission File No. 1-7724))

The Corporation and its subsidiaries have no long-term debt agreement
for which the related outstanding debt exceeds 10% of consolidated
total assets as of January 1, 2000. Copies of debt instruments for
which the related debt is less than 10% of consolidated total assets
will be furnished to the Commission upon request.

(10) Material Contracts

(a) Amended and Restated Snap-on Incorporated 1986 Incentive Stock
Program*#

(b) Form of Restated Senior Officer Agreement between the Corporation and
each of Robert A. Cornog, Branko M. Beronja, Frederick D. Hay, Donald
S. Huml and Michael F. Montemurro (incorporated by reference to
Exhibit (10)(b) to the Corporation's Annual Report on Form 10-K for
the fiscal year ended December 30, 1995 (Commission File No. 1-7724))*

(c) Form of Restated Executive Agreement between the Corporation and each
of Alan T. Biland, Sharon M. Brady, Richard V. Caskey, Dale F.
Elliott, Nicholas L. Loffredo, Denis J. Loverine, Susan F. Marrinan
and Neil T. Smith (incorporated by reference to Exhibit (10)(b) to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 30, 1995 (Commission File No. 1-7724))*

(d) Deferred Compensation Waiver and Insurance Benefit Agreement between
the Corporation and Robert A. Cornog dated January 30, 1998
(incorporated by reference to Exhibit 10(d) to the Corporation's
Annual Report on Form 10-K for the fiscal year ended January 2,1999
(Commission File No. 1-7724))*

(e) Deferred Compensation Waiver and Insurance Benefit Agreement between
the Corporation and Branko M. Beronja dated December 21, 1998
(incorporated by reference to Exhibit 10(d) to the Corporation's
Annual Report on Form 10-K for the fiscal year ended January 2,1999
(Commission File No. 1-7724))*

(f) Deferred Compensation Waiver and Insurance Benefit Agreement between
the Corporation and Frederick D. Hay dated September 27, 1999*#

(g) Form of Indemnification Agreement between the Corporation and each of
the Directors, Frederick D. Hay, Donald S. Huml, Susan F. Marrinan and
Michael F. Montemurro effective October 24, 1997 (incorporated by
reference to Exhibit (3)(a) to the Corporation's Annual Report on Form
10-K for the fiscal year ended January 2, 1998 (Commission File No.
1-7724))*

(h) Amended and Restated Snap-on Incorporated Directors' 1993 Fee Plan *#

(i) Snap-on Incorporated Deferred Compensation Plan*#

(j) Snap-on Incorporated Supplemental Retirement Plan for Officers *#

(k) Benefit Trust Agreement between the Corporation and The Northern Trust
Company, effective as of July 2, 1998 (incorporated by reference to
the Corporation's Form 8-K dated July 2, 1998 (Commission File No.
1-7724))

(l) Form of Deferred Award Agreement between the Corporation and each of
Robert A. Cornog, Branko M. Beronja, Alan T. Biland, Dale F. Elliott,
Gary S. Henning, Frederick D. Hay, Donald S. Huml, Michael F.
Montemurro and Susan F. Marrinan, dated March 1, 1999 and Form of
Restricted Stock Agreement between the Corporation and David E. Cox,
dated March 1, 1999*#

(m) Five-year Credit Agreement between the Corporation and Salomon Smith
Barney Inc., Banc One Capital Markets Inc. and the First National Bank
of Chicago (incorporated by reference to Exhibit 10(a) to the
Corporation's report on Form 10-Q for the quarterly period ended
October 2, 1999 (Commission File No. 1-7724))

(n) 364 Day Credit Agreement between the Corporation and Salomon Smith
Barney Inc., Banc One Capital Markets Inc. and the First National Bank
of Chicago (incorporated by reference to Exhibit 10(a) to the
Corporation's report on Form 10-Q for the quarterly period ended
October 2, 1999 (Commission File No. 1-7724))

(12) Computation of Ratio of Earnings to Fixed Charges#

(13) The following portions of the Corporation's Annual Report to
Shareholders, which are incorporated by reference in this Form 10-K,
are filed as Exhibit 13: Management's Discussion and Analysis of
Results of Operations and Financial Condition, Consolidated Statements
of Earnings, Consolidated Balance Sheets, Consolidated Statements of
Shareholders' Equity and Comprehensive Income, Consolidated Statements
of Cash Flows, Notes to Consolidated Financial Statements, Quarterly
Financial Information, Six-year Data, Management's Responsibility for
Financial Reporting and Report of Independent Public Accountants.#

(21) Subsidiaries of the Corporation#

(23) Consent of Independent Public Accountants#

(27) Financial Data Schedule - Fiscal 1999#

# Filed herewith.
* Denotes management contract or compensatory plan or arrangement.

Item 14(d): Schedules

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
(amounts in thousands)

Purchase
Balance (Sale)
at Acquisition Balance
Beginning (Divestiture), Costs and at End
Description of Year Net Expenses Deductions(1) of Year
- ----------- --------- ------------- -------- ------------- -------

Allowance for doubtful accounts

Year-ended
January 1, 2000 $29,231 $(7,569)* $24,126 $(18,002) $27,786

Year-ended
January 2, 1999 $20,645 $ 2,073 $24,984 $(18,471) $29,231

Year-ended
January 3, 1998 $16,903 $ 2,220 $21,040 $(19,518) $20,645

(1) This amount represents write-offs of bad debts.

* Includes a $9.5 million reduction due to the sale of receivables to Newcourt
Financial USA Inc.

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULE

We have audited, in accordance with auditing standards generally accepted in the
United States, the financial statements included in Snap-on Incorporated's (the
"Corporation") Annual Report to Shareholders, incorporated by reference in this
Form 10-K, and have issued our report thereon dated February 1, 2000. Our audit
was made for the purpose of forming an opinion on those statements taken as a
whole. The schedule listed on page 20 is the responsibility of the Corporation's
management and is presented for purposes of complying with the Securities and
Exchange Commission's rules and is not part of the basic financial statements.
This schedule has been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, fairly states in all
material respects the financial data required to be set forth therein in
relation to the basic financial statements taken as a whole.

/s/ Arthur Andersen LLP

ARTHUR ANDERSEN LLP

Chicago, Illinois
February 1, 2000

UNAUDITED PRO FORMA FINANICAL STATEMENT SCHEDULE
OF BAHCO GROUP AB ACQUISITION

On September 30, 1999, the Corporation acquired the Sandvik Saws and Tools
business, formerly a wholly owned operating unit of Sandvik AB. Sandvik Saws and
Tools business now operates as the Bahco Group AB ("Bahco"). Bahco is a
manufacturer and supplier of professional tool products and employs
approximately 2,400 people. Of those, approximately 1,000 employees are in
Sweden. Products are manufactured at 11 plants in Sweden, Germany, Portugal,
France, England, the United States and Argentina.

The acquisition is being accounted for as a purchase and the results of Bahco
have been included in the accompanying consolidated financial statements since
the date of the acquisition. The total purchase price of approximately $380
million includes the purchase of facilities, a number of brand names and
trademarks, and certain other assets and liabilities. The Corporation funded the
acquisition through working capital and an expansion of an existing commercial
paper credit facility.

A preliminary goodwill allocation in accordance with the criteria established
under Accounting Principles Board ("APB") Opinion No. 16, "Business
Combinations," has been performed. The cost of the acquisition has been
allocated on the basis of the fair market value of the assets acquired and the
liabilities assumed. This preliminary allocation results in goodwill of $215
million being recorded. The final purchase price allocation will be finalized
during 2000 upon completion of asset valuations and any post-closing purchase
price adjustments.

The preliminary allocation of the purchase price of $380 million, which includes
direct acquisition costs of $9 million, is as follows:

(Amounts in millions)
Fair value of property and equipment $ 98
Fair value of patents and trademarks 25
Other net assets acquired 42
Goodwill 215
-----
Purchase price $ 380
=====

Assigned useful lives are as follows:
Patents 13 years
Trademarks 40 years
Goodwill 40 years

The following unaudited pro forma statements of earnings of the Corporation
gives effect to the acquisition of Bahco as if the acquisition had occurred on
January 1, 1998, after giving effect to certain adjustments for depreciation,
amortization, interest expense, and income taxes associated with the purchase
method of accounting as performed at the time of the acquisition.

For pro forma purposes, the Corporation's Audited Consolidated Statement of
Earnings for 1999, has been combined with the Unaudited Combined Statement of
Revenues and Direct Expenses of the Bahco Group for the nine-months ended
September 30, 1999, and the effects of pro forma adjustments as set forth in the
notes thereto.

For pro forma purposes, the Corporation's Audited Consolidated Statement of
Earnings for 1998, has been combined with the Audited Combined Statement of
Revenues and Direct Expenses of the Bahco Group for the year ended December 31,
1998, and the effects of pro forma adjustments as set forth in the notes
thereto.

The following unaudited pro forma statements of earnings are based on historical
financial data, and on assumptions and adjustments described in the notes
thereto. All such assumptions and adjustments are inherently subject to
significant uncertainty and contingencies. It can be expected that some or all
of the assumptions on which the following unaudited pro forma statements of
earnings is based will prove to be inaccurate. As a result, the unaudited pro
forma statements of earnings do not purport to represent what the Corporation's
results of operations would have been if the acquisition of Bahco had occurred
on January 1, 1998, and is not intended to project the Company's results of
operations for any future period. The final purchase price allocation, when
completed in 2000, will result in changes to the amount of recorded assets and
goodwill included as pro forma amounts.

Unaudited Pro Forma Statement of Earnings for 1999
(Amounts in thousands except per share data)

Snap-on Bahco Group
Incorporated Unaudited
Audited Combined
Consolidated Statement of
Statement Revenues and
Of Earnings Direct Expenses
Year-Ended Nine-Months Ended Pro forma
1999 September 30, 1999 Adjustments Pro forma
--------------------------------------------------------- --------------

Net sales $ 1,945,621 $ 228,946 $ - $ 2,174,567

Cost of goods sold (1,032,836) (159,064) (1,845) a (1,193,745)

Cost of goods sold - non-recurring charges (16,598) - - (16,598)

Operating expenses (723,658) (57,964) (3,960) b (785,582)

Net finance income 60,476 - - 60,476

Restructuring and other non-recurring charges (20,592) - - (20,592)

Interest expense (27,358) - (11,738) c (39,096)

Other income (expense) - net 12,882 983 - 13,865

Earnings (loss) before income taxes 197,937 12,901 (17,543) 193,295

Income tax provision (benefit) 70,710 - (1,124) d 69,586

Net earnings (loss) $ 127,227 $ 12,901 $(16,419) $ 123,709

Earnings per weighted average
common share - basic $ 2.18 $ 2.11

Earnings per weighted average
common share - diluted $ 2.16 $ 2.10

Weighted average common shares
outstanding - basic 58,494 58,494

Effect of dilutive options 383 383

Weighted average common shares
outstanding - diluted 58,877 58,877

Unaudited Pro Forma Statement of Earnings for 1998
(Amounts in thousands except per share data)

Snap-on Bahco Group
Incorporated Audited
Audited Combined
Consolidated Statement of
Statement Revenues and
Of Earnings Direct Expenses
Year-Ended Year-Ended Pro forma
1998 December 31, 1998 Adjustments Pro forma
------------------------------------------------------------ --------------

Net sales $1,772,637 $ 323,908 $ - $ 2,096,545

Cost of goods sold (948,761) (215,119) (2,460) a (1,166,340)

Cost of goods sold - non-recurring charges (60,562) - - (60,562)

Operating expenses (705,811) (78,989) (5,280) b (790,080)

Restructuring and other non-recurring charges (89,301) - - (89,301)

Net finance income 65,933 - - 65,933

Interest expense (21,254) - (15,650) c (36,904)

Other income (expense) - net (2,041) 280 - (1,761)

Earnings (loss) before income taxes 10,840 30,080 (23,390) 17,530

Income tax provision (benefit) 15,619 - 2,393 d 18,012

Net earnings (loss) $ (4,779) $ 30,080 $(25,783) $ (482)

Earnings per weighted average
common share - basic $ (0.08) $ (0.01)

Earnings per weighted average
common share - diluted $ (0.08) $ (0.01)

Weighted average common shares
outstanding - basic 59,220 59,220

Effect of dilutive options - -

Weighted average common shares
outstanding - diluted 59,220 59,220

The following notes to the pro forma adjustments for the Unaudited Pro forma
Statement of Earnings for 1999 and 1998 represent the adjustments that would
have resulted from the acquisition of the Bahco Group had the acquisition
occurred on January 1, 1998.

(a) To adjust depreciation expense for the preliminary change in the basis to
fair market value of property, plant and equipment.

(b) To adjust depreciation and amortization expense for the preliminary change
in the basis to fair market value of property, plant and equipment and
intangible assets including goodwill.

(d) To record an income tax benefit(expense) to return to an appropriate
consolidated effective tax rate of 36% for 1999 and 36% for 1998 before
Snap-on's restructuring Project Simplify initiative that occurred in 1998.