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 December 28, 1996

[  ] 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 Identification No.)
incorporation or organization)

10801 Corporate Drive, Kenosha, Wisconsin         53141-1430
(Address of principal executive offices)          (Zip code)

Registrant's telephone number, including area code: (414) 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. [  ]

Aggregate market value of voting stock held by nonaffiliates of the
registrant at February 25, 1997: 
$2,401,637,648

Number of shares outstanding of each of the registrant's classes of common
stock at February 25, 1997:
Common stock, $1 par value, 60,609,152 shares

Documents incorporated by reference 
Portions of the Corporation's Annual Report to Shareholders for the fiscal
year ended December 28,1996, are incorporated by reference into Parts I,
II and IV of this report.

Portions of the Corporation's Proxy Statement, dated March 14, 1997,
prepared for the Annual Meeting of Shareholders scheduled for April 25,
1997, are incorporated by reference into Part III of this report.

TABLE OF CONTENTS
Page

PART I
Item 1.       Business . . . . . . . . . . . . . . . . . . . . . . . . 3
Item 2.       Description of Properties  . . . . . . . . . . . . . . . 8
Item 3.       Legal Proceedings  . . . . . . . . . . . . . . . . . . . 9
Item 4.       Submission of Matters to a Vote of Security Holders  . . 9
Item 4.1.     Executive Officers of the Registrant . . . . . . . . . . 9

PART II
Item 5.       Market for Registrant's Common Equity and 
Related Stockholder Matters  . . . . . . . . . . . . .  10
Item  6.      Selected Financial Data  . . . . . . . . . . . . . . .  10
Item  7.      Management Discussion and Analysis of Financial
Condition and Results of Operations  . . . . . . . . .  10
Item  8.      Financial Statements and Supplementary Data  . . . . .  10
Item  9.      Changes in and Disagreements with Accountants 
on Accounting and Financial Disclosure . . . . . . . .  10

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

PART IV
Item  14.     Exhibits, Financial Statement Schedules and 
Reports on Form 8-K  . . . . . . . . . . . . . . . . .  11

Auditor's Reports . . . . . . . . . . . . . . . . . . . . . . . . . .  12
Signature Pages . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
Exhibit Index   . . . . . . . . . . . . . . . . . . . . . . . . . . .  15

PART I

Item I: Business

Snap-on Incorporated (the "Corporation") was incorporated under the laws
of the state of Wisconsin in 1920 and reincorporated under the laws of the
state of Delaware in 1930.  Its corporate headquarters are located in
Kenosha, Wisconsin.

The Corporation is a leading manufacturer and distributor of high-quality
hand tools, power tools, tool storage products, diagnostics equipment,
shop equipment, and diagnostics software and other services, primarily for
use by professional technicians in vehicle service and industrial
applications.  Its products are marketed to individual automotive
technicians, shop owners, specialty service centers, national accounts,
industrial and government entities, original equipment manufacturers
("OEMs"), and other professional tool and equipment users.

The Corporation has operations throughout the world. Its largest markets
include the United States, Australia, Brazil, Canada, Germany, Japan,
Mexico, the Netherlands, Spain and the United Kingdom. Products and
services to support its products and customers are marketed and
distributed in more than 100 countries.

In 1996 the Corporation acquired new business operations that expanded its
product line, distribution channels and geographic reach, including the
John Bean Company (formerly the Automotive Equipment Service Division of
FMC Corporation), Automotive Data Solutions ("ADS") and Snap-on Tools/PST
Africa (Pty.), Ltd. ("Snap-on Tools/PST Africa").

The John Bean Company is a leading producer of wheel and brake service
equipment, including wheel aligners and balancers, tire changers, and brake
lathes.  Its products are sold in North America, Europe and select other
parts of the world.  ADS is a tele-diagnostics service for automotive
technicians.  Snap-on Tools/PST Africa is a mobile van distributor of
tools to professional users in South Africa.

Subsequent to the close of 1996, the Corporation acquired a 50 percent
interest in the Mitchell Repair Information business of The Thomson
Corporation.  The new company is a provider of print and electronic
versions of vehicle mechanical and electrical system repair information to
vehicle repair and service establishments throughout North America.  The
Corporation also acquired Computer Aided Service, Inc. ("CAS"), a 
developer of repair shop management systems, point of sale systems and
diagnostics equipment.

The Corporation conducts its business through four principal operations: 

Tools

-  The Transportation business focuses on the development and sale of
products and services through the Corporation's worldwide dealer direct
sales programs to professional technicians and shop owners, and through
distributors in some non-U.S. locations. Trademarks associated with this
operating group include: Snap-on - hand tools, power tools, tool storage
units, and certain equipment; Blue Point - hand tools and power tools; and
Wheeltronic - hoists and lifts for vehicle service shops.  Some
differentiated equipment products developed by the Corporation's other
operations are also sold through the distribution channels employed by
this business.  In addition, to complete the product line, some items are
purchased from external manufacturers.

-  The Industrial operation focuses on the development and sale of
industrial tools and equipment through a direct sales force as well as
through industrial distributors, and on the development and sale of tools
for the medical profession. Trademarks associated with this operating
group include: Snap-on - hand tools and tool storage units; J.H. Williams
- hand tools; A.T.I. Tools - tools and equipment for aerospace and
industrial applications; Sioux Tools - power tools; and Snap-on Medical
Products - tools for orthopedic applications.

Equipment

This operation focuses on the development and sale of diagnostics, under-
car, emissions and safety, and shop equipment; shop management systems;
and vehicle repair and service information to vehicle service and repair
shops.  Trademarks associated with this operating group include: Sun
Electric ("Sun") - diagnostics and service equipment; John Bean - under-
car and other service equipment; Balco - engine diagnostics, wheel
balancing and alignment equipment; Mitchell - repair and service
information and shop managment systems; and Edge Diagnostic Systems -
software to diagnose vehicle computer systems.

Financial Services

Through its Snap-on Credit Corporation subsidiary, Financial Services is
responsible for certain credit and non-credit services used to support
sales and to provide dealer financing options.  Credit programs facilitate
the sale of the Corporation's products and services, especially higher-
value products such as diagnostics and other shop equipment.

Products, Services, and Markets Served

The Corporation offers a broad product line which it divides into two
groups -- tools and equipment.

Tools -- Includes hand tools, power tools and tool storage products.  Hand
tools include wrenches, screwdrivers, sockets, pliers, ratchets and other
similar products, and instruments developed for medical applications and
for the manufacture and servicing of electronic equipment.  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 for automotive, industrial, aerospace and other
storage applications.

Equipment -- Includes hardware and software solutions for the diagnosis
and service of automotive and industrial equipment. The primary products
are: engine and emissions analyzers, air conditioning service equipment,
brake service equipment, wheel balancing and alignment equipment,
transmission troubleshooting equipment, vehicle safety testing equipment,
battery chargers, and lifts and hoists used in repair shops. Also included
are service and repair information products, on-line diagnostics services,
systems integration and purchasing facilitation services.

In the U.S. the Corporation supports the sale of its diagnostics and shop
equipment by offering training programs to technician customers. These
programs offer certification in both specific automotive technologies and
in the application of specific diagnostics equipment developed and
marketed by the Corporation.

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 within the markets 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 against companies that sell
through non-mobile-van distributors; these competitors include The Stanley
Works, Sears, Roebuck and Co., and Strafor Facom.  In the industrial
sector, major competitors include Armstrong (Danaher Corporation), Cooper
Industries and Proto (The Stanley Works).  The major competitors selling
diagnostics and shop equipment to shop owners in the vehicle service and
repair sector include SPX Corporation and Hunter Engineering.

Consolidated Sales

The following table shows the approximate percentage of consolidated sales
for each of the Corporation's product groups in each of the past three
years.

Product Group % of Sales     1996       1995      1994

Tools
Hand tools                  40%        40%       38%
Power tools                  8%        10%        7%
Tool storage products       10%        10%       11%
---        ---       --- 
58%        60%       56%
Equipment                     42%        40%       44%
---        ---       --- 
100%       100%      100%

Market Sectors Served -- The Corporation markets and distributes its
products around the world to professional users primarily in two market
sectors:  the vehicle service and repair sector, and the industrial
sector.  For further information on the Corporation's international and
domestic operations, see Note 14 on page 34 of the Corporation's 1996
Annual Report, incorporated herein by reference.

Vehicle Service and Repair Sector

The vehicle service and repair sector has two primary customer groups:
professional technicians, primarily in the vehicle service industry, who
purchase tools and equipment for themselves, and service and repair shop
owners (both independent and national chains) and managers who purchase
equipment for use by multiple technicians within a service or repair
facility.  Following is a discussion of the characteristics of these
customers.

Professional Technicians -- The Corporation markets its products and
services to professional automotive technicians in the U.S. and select
other countries, primarily through its dealer van distribution system. It
provides innovative tool and equipment solutions, as well as technical
sales support and training, to meet technicians' evolving needs.

Shop Owners -- The Corporation also serves owners and managers of shops
where technicians work with tools, diagnostics equipment, repair and
service information, and shop management products.  These products are
sold through the Corporation's dealer van distribution system.  In
addition, certain tools and equipment, differentiated by product features
and brand, are sold through distributors to shop owners.

Major challenges for the Corporation and the industry include increased
competition within the dealer van channel during the past decade and the
increasing rate of technological change within motor vehicles. 

Industrial Sector

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

Major challenges in the industrial market 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 for
industrial tools and equipment.

Distribution Channels and the Franchise Program

The Corporation serves customers through direct and indirect sales
channels.

Distribution to Technicians and Shop Owners 

Snap-on Dealer Organization -- Sales to technicians and select shop owners
are conducted weekly at the customer's place of business, primarily
through the mobile dealer van system.  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, for up to one year prior to
making an investment in a franchise.  In addition, through Snap-on
Financial Services, Inc. and its subsidiary, Snap-on Credit Corporation,
the Corporation also provides financial assistance for newly converted
franchise 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 1996, approximately 86 percent of
all U.S. dealers were enrolled as franchisees.

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 help maximize
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.

The Corporation has replicated its dealer van method of distribution in
Australia, Canada, Germany, Mexico, the Netherlands, Japan and the United
Kingdom.  The Corporation also markets products to additional select
countries through its subsidiary, Snap-on Tools International, Ltd., which
sells to foreign distributors under license or contract with the
Corporation.

Snap-on/Sun Tech Systems -- Higher-end diagnostics and shop equipment is
also sold directly to customers through the Snap-on/Sun Tech Systems
employee sales force ("Tech Specialists").  Tech Specialists are
compensated primarily on the basis of commission.  In the U.S., Tech
Specialists sell Snap-on and Sun brand equipment to accounts on their own,
and assist dealers in the demonstration and sale of Snap-on and Sun brand
diagnostics equipment.

The Snap-on/Sun Tech Systems group also sells Snap-on and Sun equipment to
volume buyers such as retail service centers and OEMs through a national
account sales organization. In addition, Sun brand equipment is marketed
through distributors in South America and Asia, and through both a direct
sales force and distributors in Europe.

With the 1996 addition of the John Bean Company, the Corporation now
distributes under-car and other service equipment through a number of
distributors, located primarily in North America, Europe and select other
parts of the world.  The majority of these products are sold under the
John Bean brand and are differentiated from those sold through the dealer
van channel.

Distribution to Industrial Customers

Marketing to industrial and governmental customers is by both direct sales
through industrial sales representatives, who are employees, and indirect
sales through independent industrial distributors.  At the end of 1996,
the Corporation had industrial sales representatives in the United States,
Canada, Australia, Japan, Mexico, Puerto Rico, and some European
countries, with the U.S. representing the majority of the Corporation's
total industrial sales.  The sales representatives focus on industrial
customers who prefer to buy on quality and service, as well as on certain
OEM accounts.

Raw Material & Purchased Product

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

The majority of 1996 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 1996 consolidated net sales.

Patents and Trademarks

The Corporation vigorously pursues and relies on patent protection to
protect its inventions and its position in the market. As of December 28,
1996, the Corporation and its subsidiaries held over 600 patents
worldwide, with more than 470 pending patent applications.  No sales
relating to any single patent represent a material portion of the
Corporation's revenues.

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 automotive 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
U.S. and 67 other countries, and additional applications for trademark
registrations are pending.  The Corporation rigorously 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 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 to extend credit to its dealers
and to purchase installment credit receivables from dealers is discussed
in "Management's Discussion and Analysis of Results of Operations and
Financial Condition," which is found on pages 16 to 19 of the
Corporation's 1996 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 a material effect
upon the Corporation's capital expenditures, earnings or competitive
position.

Employees

At the end of 1996, the Corporation employed approximately 10,600 people,
of whom approximately one-third are engaged in manufacturing activities.

Item 2: Description of 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 U.S. facilities occupy approximately 4.2 million square
feet, of which approximately 84 percent is owned.  The Corporation's
facilities outside the U.S. contain approximately  1.7 million square
feet, of which approximately 69 percent is owned.

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
Sunnyvale, California              Manufacturing         Leased

Columbus, Georgia                  Manufacturing         Owned
Crystal Lake, Illinois             Distribution          Owned
and manufacturing
Mt. Carmel, Illinois               Manufacturing         Owned
Ottawa, Illinois                   Distribution          Owned
Algona, Iowa                       Manufacturing         Owned

Sioux City, Iowa                   Manufacturing         Owned
Natick, Massachusetts              Manufacturing         Owned
Olive Branch, Mississippi          Distribution          Leased and owned
Carson City, Nevada                Distribution          Owned
Robesonia, Pennsylvania            Distribution          Owned

Johnson City, Tennessee            Manufacturing         Owned
Elizabethton, Tennessee            Manufacturing         Owned
East Troy, Wisconsin               Manufacturing         Owned
Elkhorn, Wisconsin                 Manufacturing         Owned
Kenosha, Wisconsin                 Manufacturing         Owned

Milwaukee, Wisconsin               Manufacturing         Owned
Sydney, Australia                  Distribution          Leased
Barbara D'oeste, Brazil            Manufacturing         Owned
Calgary, Canada                    Distribution          Leased
Mississagua, Canada                Manufacturing         Leased

Newmarket, Canada                  Distribution          Owned
and manufacturing
Kettering, England                 Distribution          Owned
King's Lynn, England               Distribution          Owned
and manufacturing
Altmittweida, Germany              Distribution          Owned
Cork, Ireland                      Manufacturing         Leased
Shannon, Ireland                   Manufacturing         Leased

Tokyo, Japan                       Distribution          Leased
Amsterdam, the Netherlands         Distribution          Owned
Irun, Spain                        Manufacturing         Owned
Urretxu, Spain                     Manufacturing         Owned
Vitoria, Spain                     Distribution          Owned
and manufacturing

Item 3: Legal Proceedings

Note 4 to the Financial Statements of the Corporation on pages 25 and
26 of its 1996 Annual Report is incorporated herein by reference.  None
of such litigation is material within the meaning of Section 103 of
Regulation S-K in that such matters individually or in the aggregate
do not exceed 10% of current assets.  The Corporation intervened in 
litigation commenced by Tejas Testing Technology One, L.C. and Tejas 
Testing Technology Two, L.C. (the "Tejas Companies"), as described in 
Note 13 to the Financial Statements of the Corporation on pages 32 and
33 of its 1996 Annual Report, which Note is incorporated herein by 
reference.  Such litigation was commenced on May 2, 1995 and is pending
in the United States District Court for the Western District of Texas, 
Austin Division, and was also commenced on November 20, 1995 in the 
345th Judicial District Court of Travis County, Texas.  On February 11,
1997, Systems Control, Inc. and Systems Control Acquisition Corp., 
affiliates of the Tejas Companies, commenced litigation against the
Corporation in the Superior Court of the State of California for the
County of San Francisco to resist their obligation to indemnify the
Corporation in full as described in Note 13.

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 December 28, 1996.

Item 4.1:  Executive Officers of the Registrant

The executive officers of the Corporation, their ages as of December 28,
1996, and their current titles and positions held during the last five
years are listed below.

Robert A. Cornog  (56) - Chairman, President and Chief Executive Officer
since July 1991.  A Director since 1982.

Branko M. Beronja (62) - Senior Vice President - Diagnostics, North
America since April 1996.  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 (52) - Senior Vice President - Transportation since
February 1996.  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 (50) - 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 (48) - Senior Vice President - Financial Services
and Administration since August 1994.  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.

Jay H. Schnabel (54) - Senior Vice President - Europe since April 1996. 
Senior Vice President - Diagnostics from April 1994 to April 1996.  Senior
Vice President - Administration from April 1990 to April 1994. A Director
since August 1989.

Gregory D. Johnson  (47) - Controller since April 1992.  Financial
Controller - Asia/Pacific from May 1991 to April 1992.

Susan F. Marrinan  (48) - Vice President, Secretary and General Counsel
since January 1992.  Secretary and General Counsel from November 1990 to
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 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.

PART II

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

At December 28, 1996, the Corporation had 60,785,367 shares of common
stock outstanding.

On January 26, 1996, the Corporation's Board of Directors authorized the
Corporation to repurchase shares of the Corporation's common stock from
time to time in the open market or in privately negotiated transactions. 
The authority allows the repurchase of up to the number of shares issued
or delivered from treasury from time to time under the various plans the
Corporation has in place that call for the issuance of the Corporation's
common stock.  Currently, those plans include the Corporation's Employee
Stock Ownership Plan, Franchise Dealer Stock Ownership Plan, Amended and
Restated 1986 Incentive Stock Program, Amended and Restated Directors'
1993 Fee Plan, and Dividend Reinvestment and Stock Purchase Plan. Based
upon the number of shares issued under plans and programs through February
25, 1997, as of that date the Corporation had the authority pursuant to
the Board's action to repurchase 243,503 shares.

Additional information required by Item 5 is contained on page 40 of the
Corporation's 1996 Annual Report and is incorporated herein by reference
to said Annual Report.

Item 6: Selected Financial Data

The information required by Item 6 is contained on pages 36 and 37 of the
Corporation's 1996 Annual Report and is incorporated herein by reference
to said Annual Report.

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

The information required by Item 7 is contained on pages 16 to 19 of the
Corporation's 1996 Annual Report and is incorporated herein by reference
to said Annual Report.

Item 8: Financial Statements and Supplementary Data

The information required by Item 8 is contained on pages 20 to 34 of the
Corporation's 1996 Annual Report and is incorporated herein by reference
to said Annual Report.

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 14, 1997,
and is incorporated herein by reference to said Proxy Statement.  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 of late filers pursuant to Item 405 of Regulation S-K is
contained on page 11 of the Corporation's Proxy Statement, dated March 14,
1997, and is incorporated herein by reference to said Proxy Statement.

Item 11: Executive Compensation

The information required by Item 11 is contained on pages 7 to 9 of the
Corporation's Proxy Statement, dated March 14, 1997, and is incorporated
herein by reference to said Proxy Statement.

Item 12: Security Ownership of Certain Beneficial Owners and Management

The information required by Item 12 is contained on page 5 of the
Corporation's Proxy Statement, dated March 14, 1997, and is incorporated
herein by reference to said Proxy Statement.

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 Auditors' Report thereon, each included in the 1996 Annual Report
of the Corporation to its shareholders for the year ended December 28,
1996, are incorporated by reference in Item 8 of this report:

Consolidated Balance Sheets as of December 28, 1996 and December 30, 1995.

Consolidated Statements of Earnings for the years ended December 28, 1996,
December 30, 1995 and December 31, 1994. 

Consolidated Statements of Shareholders' Equity for the years ended
December 28, 1996, December 30, 1995 and December 31, 1994.

Consolidated Statements of Cash Flows for the years ended December 28,
1996, December 30, 1995 and December 31, 1994.

Notes to Consolidated Financial Statements.

2.  Financial Statement Schedule

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

Schedule II     Valuation and Qualifying Accounts     Page 17

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 1996 Annual Report in the Notes to Consolidated Financial
Statements for the years ended December 28, 1996, December 30, 1995 and
December 31, 1994, 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.

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

No reports on Form 8-K were filed during the last quarter of the period
covered by this report.

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULE

We have audited, in accordance with generally accepted auditing standards,
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 January 27, 1997. 
Our audit was made for the purpose of forming an opinion on those
statements taken as a whole.  The schedule listed on page 17 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
January 27, 1997

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation
of our reports included (or incorporated by reference) in this Form 10-K,
into the Corporation's previously filed Registration Statement File Nos.
2-53663, 2-53578, 33-7471, 33-22417, 33-37924, 33-39660, 33-57898, 33-
55607, 33-58939, 33-58943, 333-14769, 333-21277 and 333-21285.

/s/ Arthur Andersen LLP

ARTHUR ANDERSEN LLP

Chicago, Illinois
March 27, 1997

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 27, 1997
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 27, 1997   
R. A. Cornog, Chairman of the Board of Directors,
President and Chief Executive Officer

/s/ D. S. Huml                               Date:  March 27, 1997   
D. S. Huml, Principal Financial Officer,
and Senior Vice President - Finance

/s/ G. D. Johnson                            Date:  March 27, 1997  
G. D. Johnson, 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 27, 1997     
B. M. Beronja, Director

By: /s/ D. W. Brinckman                          Date:  March 27, 1997  
D. W. Brinckman, Director

By: /s/ B. S. Chelberg                           Date:  March 27, 1997  
B. S. Chelberg, Director

By: /s/ R. J. Decyk                              Date:  March 27, 1997  
R. J. Decyk, Director

By: /s/ R. F. Farley                             Date:  March 27, 1997  
R. F. Farley, Director

By: /s/ L. A. Hadley                             Date:  March 27, 1997 
L. A. Hadley, Director

By: /s/ A. L. Kelly                              Date:  March 27, 1997  
A. L. Kelly, Director

By: /s/ G. W. Mead                               Date:  March 27, 1997  
G. W. Mead, Director

By: /s/ E. H. Rensi                              Date:  March 27, 1997  
E. H. Rensi, Director

By: /s/ J. H. Schnabel                           Date:  March 27, 1997  
J. H. Schnabel, Director

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

Balance of 
Balance at  Subsidiary  Charged to                 Balance
beginning   at time of   costs and                 at end
Description   of year    acquisition  expenses   Deductions(1)  of year

Allowance for 
doubtful accounts

Year ended
December 28,
1996        $14,650,458   $296,140   $13,611,414  $11,655,431  $16,902,581

Year ended
December 30,
1995        $13,180,862   $205,414   $12,999,732  $11,735,550  $14,650,458

Year ended
December 31,
1994        $14,946,208   $ 96,355   $ 8,652,343  $10,514,044  $13,180,862

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

EXHIBIT INDEX

Item 14(c):  Exhibits

(3)  (a)  Restated Certificate of Incorporation of the Corporation,
effective as of March 10, 1995 (incorporated by reference to
Exhibit (3)(a) to the Corporation's Annual Report on Form 10-K
for the fiscal year ended December 31, 1994 (Commission File No.
1-7724))

(b)  Bylaws of the Corporation, effective as of January 26, 1996

(4)  (a)  Rights Agreement dated as of October 23, 1987 between the
Corporation and Harris Trust and Savings Bank, as Rights Agent
(incorporated by reference to Exhibit 1 to the Corporation's
Registration Statement on Form 8-A dated October 26, 1987
(Commission File No. 1-7724))

(b)  Amendment to Rights Agreement dated as of May 21, 1992
(incorporated by reference to Exhibit 1 to the Corporation's
Current Report on Form 8-K dated June 4, 1992 (Commission File
No. 1-7724))

(c)  Amendment to Rights Agreement dated as of January 28, 1994
(incorporated by reference to Exhibit 1 to the Corporation's
Current Report on Form 8-K dated January 28, 1994 (Commission
File No. 1-7724))

(d)  Amendment to Rights Agreement dated as of June 28, 1996
(incorporated by reference to Exhibit 1.1 to the Corporation's
Current Report on Form 8-A dated June 28, 1996 (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 December 28, 1996.  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
Plan*

(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, Michael F. Montemurro and Jay
H. Schnabel (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 Richard V. Caskey, Dan G. Craighead, Dale F. Elliott,
Gregory D. Johnson, Nicholas L. Loffredo, Denis J. Loverine,
Susan F. Marrinan, Lawrence G. Panatera, and William R. Whyte
(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)  Indemnification Agreement for Directors (incorporated by
reference to Exhibit B to the Corporation's Proxy Statement
dated March 23, 1990 (Commission File No. 1-7724))*

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

(f)  Snap-on Incorporated Deferred Compensation Plan*

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

(h)  Receivables Purchase and Sale Agreement, dated as of October 6,
1995, among Snap-on Credit Corporation, as Seller, Corporate
Asset Funding Company, Inc., as Investor, and Citicorp North
America, Inc., individually and as Agent (incorporated by
reference to Exhibit (10)(a) to the Corporation's Quarterly
Report on Form 10-Q for the quarter ended September 28, 1996
(Commission File No. 1-7724))

(i)  Receivables Purchase and Sale Agreement, dated as of October 6,
1995, among Snap-on Credit Corporation, as Seller, the banks set
forth on the signature pages thereof, and Citicorp North
America, Inc., individually and as Agent (incorporated by
reference to Exhibit (10)(b) to the Corporation's Quarterly
Report on Form 10-Q for the quarter ended September 28, 1996
(Commission File No. 1-7724))

(j)  Support Agreement, dated as of October 6, 1995, by Snap-on
Incorporated in favor of Corporate Asset Funding Company, Inc.,
Citibank, N.A. and Citicorp North America, Inc. (incorporated by
reference to Exhibit 10.3 to the Corporation's Quarterly Report
on Form 10-Q for the quarter ended September 30, 1995
(Commission File No. 1-7724))

(13) Annual Report to Shareholders
(21) Subsidiaries of the Corporation
(23) Consent of Independent Public Accountants (included with Report of
Independent Public Accountants on Financial Statement Schedule)
(27) Financial Data Schedule

* Denotes management contract or compensatory plan or arrangement

SNAP-ON INCORPORATED
BYLAWS
AMENDED AND RESTATED

INDEX

ARTICLE I - OFFICES

1.1. Registered Office and Agent  . . . . . . . . . . . . . . . . . .    1

1.2. Other Offices  . . . . . . . . . . . . . . . . . . . . . . . . .    1

ARTICLE II - THE STOCKHOLDERS

2.1. Place of Meetings  . . . . . . . . . . . . . . . . . . . . . . .    1

2.2. Annual Meeting . . . . . . . . . . . . . . . . . . . . . . . . .    1

2.3. Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    1

2.4. Voting . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    2

2.5. Proxies  . . . . . . . . . . . . . . . . . . . . . . . . . . . .    2

2.6. List of Stockholders . . . . . . . . . . . . . . . . . . . . . .    3

2.7. Special Meetings . . . . . . . . . . . . . . . . . . . . . . . .    3

2.8. Notice of Meetings . . . . . . . . . . . . . . . . . . . . . . .    3

2.9. Stockholder Nominations and Proposals  . . . . . . . . . . . . .    3

2.10. Voting Procedures and Inspectors of Elections . . . . . . . . .    4

ARTICLE III - THE BOARD OF DIRECTORS

3.1. Powers, Number and Classification of Directors . . . . . . . . .    5

3.2. Vacancies  . . . . . . . . . . . . . . . . . . . . . . . . . . .    6

3.3. Place of Meetings  . . . . . . . . . . . . . . . . . . . . . . .    6

3.4. Regular Meetings . . . . . . . . . . . . . . . . . . . . . . . .    6

3.5. Special Meetings . . . . . . . . . . . . . . . . . . . . . . . .    6

3.6. Quorum; Voting . . . . . . . . . . . . . . . . . . . . . . . . .    7

3.7. Quorum During Emergency  . . . . . . . . . . . . . . . . . . . .    7

3.8. Informal Action  . . . . . . . . . . . . . . . . . . . . . . . .    7

3.9. Meeting by Telephone . . . . . . . . . . . . . . . . . . . . . .    7

3.10. Compensation  . . . . . . . . . . . . . . . . . . . . . . . . .    7

3.11. Committees  . . . . . . . . . . . . . . . . . . . . . . . . . .    8

ARTICLE IV - OFFICERS

4.1. Election and Removal of Chairman of the Board of Directors . . .    8

4.2. Duties of the Chairman of the Board of Directors . . . . . . . .    8

4.3. Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . .    9

4.4. Removal  . . . . . . . . . . . . . . . . . . . . . . . . . . . .    9

4.5. Designation of Chief Executive Officer and Chief Operating
Officer  . . . . . . . . . . . . . . . . . . . . . . . . . . . .    9

4.6. Chief Executive Officer  . . . . . . . . . . . . . . . . . . . .    9

4.7. Chief Operating Officer  . . . . . . . . . . . . . . . . . . . .   10

4.8. President  . . . . . . . . . . . . . . . . . . . . . . . . . . .   10

4.9. Executive Vice Presidents  . . . . . . . . . . . . . . . . . . .   10

4.10. Senior Vice Presidents  . . . . . . . . . . . . . . . . . . . .   10

4.11. Chief Information Officer . . . . . . . . . . . . . . . . . . .   10

4.12. Chief Financial Officer . . . . . . . . . . . . . . . . . . . .   10

4.13. Vice Presidents . . . . . . . . . . . . . . . . . . . . . . . .   11

4.14. Appointed Officers  . . . . . . . . . . . . . . . . . . . . . .   11

4.15. Secretary . . . . . . . . . . . . . . . . . . . . . . . . . . .   11

4.16. Treasurer . . . . . . . . . . . . . . . . . . . . . . . . . . .   11

4.17. Controller  . . . . . . . . . . . . . . . . . . . . . . . . . .   12

4.18. Delegation of Duties  . . . . . . . . . . . . . . . . . . . . .   12

4.19. Compensation  . . . . . . . . . . . . . . . . . . . . . . . . .   12

4.20. Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   12

ARTICLE V - CERTIFICATES OF STOCK AND THEIR TRANSFER

5.1. Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . .   12

5.2. Form of Certificates . . . . . . . . . . . . . . . . . . . . . .   13

5.3. Transfer of Certificates . . . . . . . . . . . . . . . . . . . .   13

5.4. Record Date  . . . . . . . . . . . . . . . . . . . . . . . . . .   13

5.5. Lost or Destroyed Certificates . . . . . . . . . . . . . . . . .   14

5.6. Stock Transfer Books; Record Date  . . . . . . . . . . . . . . .   14

5.7. Consent of Stockholders in Lieu of Meeting . . . . . . . . . . .   15

ARTICLE VI - BOOKS AND ACCOUNTS

6.1. Location . . . . . . . . . . . . . . . . . . . . . . . . . . . .   15

6.2. Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . .   15

ARTICLE VII - CHECKS, NOTES, CONTRACTS, ETC.

7.1. Checks; Notes  . . . . . . . . . . . . . . . . . . . . . . . . .   16

7.2. Execution of Corporate Contracts . . . . . . . . . . . . . . . .   16

ARTICLE VIII - MISCELLANEOUS

8.1. Fiscal Year  . . . . . . . . . . . . . . . . . . . . . . . . . .   16

8.2. Corporate Seal . . . . . . . . . . . . . . . . . . . . . . . . .   16

8.3. Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   16

8.4. Waiver of Notice . . . . . . . . . . . . . . . . . . . . . . . .   17

8.5. Voting of Stock in Other Corporations  . . . . . . . . . . . . .   17

ARTICLE IX - INDEMNIFICATION

9.1. Eligibility; Expenses  . . . . . . . . . . . . . . . . . . . . .   17

9.2. Suit to Collect  . . . . . . . . . . . . . . . . . . . . . . . .   18

9.3. Nonexclusivity of Rights . . . . . . . . . . . . . . . . . . . .   18

9.4. Insurance  . . . . . . . . . . . . . . . . . . . . . . . . . . .   18

9.5. Expenses as a Witness  . . . . . . . . . . . . . . . . . . . . .   18

9.6. Indemnity Agreements . . . . . . . . . . . . . . . . . . . . . .   19

9.7. Continuation of Rights . . . . . . . . . . . . . . . . . . . . .   19

9.8. Amendment  . . . . . . . . . . . . . . . . . . . . . . . . . . .   19

ARTICLE X - AMENDMENT OF BYLAWS

10.1. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . .   19

SNAP-ON INCORPORATED

AMENDED AND RESTATED BYLAWS

ARTICLE I - OFFICES

1.1. Registered Office and Agent.  The registered office shall be in
the City of Wilmington, County of New Castle, State of Delaware, and the
name of the resident agent in charge thereof is the Corporation Trust
Company of America.

1.2. Other Offices.  The Corporation may have its principal executive
office in the City of Kenosha, State of Wisconsin, and may also have
offices at such other places as the Board of Directors may from time to
time determine or the business of the Corporation may require.

ARTICLE II - THE STOCKHOLDERS

2.1. Place of Meetings.  All meetings of the stockholders, whether
annual or special, shall be held at the offices of the Corporation in
Kenosha, Wisconsin, or at such other place, within or without the State of
Delaware, as may be fixed from time to time by the Board of Directors.

2.2. Annual Meeting.  An annual meeting of stockholders shall be held
on such date and at such time as shall be designated from time to time by
the Board of Directors and stated in the notice of the meeting. 

2.3. Quorum.  A majority of the outstanding stock entitled to vote,
present in person or by proxy duly authorized by the stockholder and filed
with the Secretary, shall constitute a quorum at all meetings of the
stockholders except as otherwise provided by law, by the Certificate of
Incorporation or by these Bylaws.  If, however, a majority shall not be
present or represented at any meeting of the stockholders, the
stockholders entitled to vote thereat, present in person, or by proxy duly
authorized by the stockholder and filed with the Secretary, shall have
power to  adjourn the meeting from time to time, without notice other than
announcement at the meeting of the place, date, and hour of the adjourned
meeting, until a quorum shall be present or represented.  At the adjourned
meeting at which a quorum shall be present or represented, any business
may be transacted which might have been transacted at the meeting as
originally notified.  If the adjournment is for more than thirty (30)
days, or if after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given to
each stockholder of record entitled to vote at the meeting.  The
stockholders present at a duly organized meeting may continue to transact
business until adjournment notwithstanding the withdrawal of enough
stockholders to leave less than a quorum. 

2.4. Voting.  When a quorum is present at any meeting, and subject to
the provisions of the General Corporation Law of the State of Delaware,
the Certificate of Incorporation or these Bylaws in respect of the vote
that shall be required for a specific action, the vote of the holders of a
majority of the stock having voting power, present in person or
represented by proxy duly authorized by the stockholder and filed with the
Secretary, shall decide any question brought before the meeting, unless
the question is one upon which, by express provision of the statutes or of
the Certificate of Incorporation or of these Bylaws, a different vote is
required, in which case the express provision shall govern and control the
decision of such question.  Directors shall be elected by a plurality of
the votes of the shares present in person or represented by proxy at the
meeting and entitled to vote on the election of Directors.  Each
stockholder shall have one vote for each share of stock having voting
power registered in his name on the books of the Corporation, except as
otherwise provided in the Certificate of Incorporation.

2.5. Proxies.  At any meeting of the stockholders, every stockholder
having the right to vote shall be entitled to vote in person, or by proxy
duly authorized and bearing a date not more than three years prior to said
meeting, unless the proxy provides for a longer period.  Without limiting
the manner in which a stockholder may authorize another person or persons
to act for him as proxy, the stockholder may validly grant such authority
by:

(a)  executing a writing to that effect, which execution may be
accomplished by the stockholder or his authorized officer,
director, employee or agent signing the writing or causing his
signature to be affixed to the writing by any reasonable means
including, but not limited to, by facsimile signature; or (b)
transmitting or authorizing the transmission of a telegram,
cablegram, or other means of electronic transmission to the
person who will be the holder of the proxy or to a proxy
solicitation firm, proxy support service organization or like
agent duly authorized by the person who will be the holder of
the proxy to receive such transmission, provided that any
telegram, cablegram or other means of electronic transmission
must either set forth or be submitted with information from
which it can be determined that the telegram, cablegram or other
electronic transmission was authorized by the stockholder.  If
it is determined that any telegram, cablegram or other
electronic transmission submitted pursuant to clause (b) above
is valid, the inspectors shall specify the information upon
which they relied.  Any copy, facsimile telecommunication or
other reliable reproduction of the writing or transmission
created pursuant to the preceding sentence may be substituted or
used in lieu of the original writing or transmission for any and
all purposes for which the original writing or transmission
could be used, provided that such copy, facsimile
telecommunication or other reproduction shall be a complete
reproduction of the entire original writing or transmission.

2.6. List of Stockholders.  A complete list of the stockholders
entitled to vote at each meeting of stockholders, arranged in alphabetical
order, with the address of each as shown on the records of the
Corporation, and the number of voting shares registered in the name of
each in the records of the Corporation, shall be prepared by the Secretary
and kept, either at a place within the city where the meeting is to be
held, which place shall be specified in the notice of the meeting, or if
not so specified at the place where the meeting is to be held for a period
of at least ten (10) days prior to the meeting.  During the ten (10) day
period, during the usual business hours, and during the meeting, the list
shall be open to the examination of any stockholder.

2.7. Special Meetings.  Special meetings of stockholders, for any
purpose or purposes, unless otherwise prescribed by statute, may be called
by the Chief Executive Officer, and shall be called by the Chief Executive
Officer or Secretary at the request in writing of a majority of the
members of the Board of Directors.  Such request shall state the purpose
or purposes of the proposed meeting. 

2.8. Notice of Meetings.  Written notice of each meeting of
stockholders, stating the date, time and place, and in the case of a
special meeting the object thereof, shall be mailed, postage prepaid, not
less than ten (10) nor more than sixty (60) days before the meeting, to
each stockholder entitled to vote thereat, at the address of the
stockholder which appears on the books of the Corporation.

2.9. Stockholder Nominations and Proposals.

(a)  At any meeting of stockholders, no business shall be
conducted which has not been properly brought before the
meeting.  To be properly brought before a meeting, business must
be (i) specified in the notice of meeting (or any supplement
thereto) given by or at the direction of the Board of Directors,
(ii) otherwise properly brought before the meeting by or at the
direction of the Board of Directors, or (iii) otherwise properly
brought before the meeting by a stockholder.

(b)  For stockholder nominations and/or proposals to be properly
brought before a meeting by a stockholder, the stockholder must
have given timely notice thereof in writing to the Secretary of
the Corporation.  To be timely, a stockholder's notice must be
delivered to, or mailed and received at, the principal executive
offices of the Corporation not less than sixty (60) days nor
more than ninety (90) days prior to the anniversary date of the
immediately preceding annual meeting of stockholders; provided,
however, that in the event that the annual meeting is called for
a date that is not within thirty (30) days before or after such
anniversary date, notice by the stockholder in order to be
timely must so be received not later than the close of business
on the tenth day following the day on which the notice of the
date of the meeting was mailed or public disclosure was made,
which ever first occurs. 

(c)  In the case of stockholder nominations for election to the
Board of Directors, the notice shall set forth (i) the name,
age, business address and, if known, residence address of each
nominee proposed in the notice, (ii) the principal occupations
or employment of each nominee for the past five (5) years, (iii)
the number of shares of the Corporation which are beneficially
owned by each nominee, (iv) other directorships held by each
nominee, (v) the names of business entities of which each
nominee owns a ten percent (10%) or more beneficial interest and
(vi) all other information with respect to each nominee as is
required by the Federal proxy rules in effect at the time such
notice is submitted.  In addition, the notice shall be
accompanied by a statement, over the signature of each proposed
nominee, that the nominee consents to being a nominee and that
if elected intends to serve as a Director, and confirming the
information with respect to him set forth in the notice.

(d)  In the case of stockholder proposals, the notice shall set
forth (i) a brief description of the proposal or business
desired to be brought before the meeting and the reasons for
conducting such business at the meeting, (ii) the name, age,
business and residence address of the stockholder submitting the
proposal, (iii) the principal occupation or employment of such
stockholder, (iv) the number of shares of the Corporation which
are beneficially owned by such stockholder and (v) any material
interest of the stockholder in such proposal.  The Chairman of
the Board of Directors shall, if the facts warrant, determine
and declare to the meeting that a proposal was not properly
brought before the meeting in accordance with the provisions of
this Section 2.9, and if he should so determine, and any
proposal not properly brought before the meeting shall not be
transacted.  Notwithstanding anything in  these Bylaws to the
contrary, no business shall be conducted at any meeting except
in accordance with the procedures set forth in this Section 2.9.

2.10.  Voting Procedures and Inspectors of Elections.

(a)  The Corporation, by action of the Secretary, shall, in
advance of any meeting of stockholders, appoint one or more
inspectors to act at the meeting and make a written report
thereof.  The Corporation may designate one or more persons as
alternate inspectors to replace any inspector who fails to act. 
If no  inspector or alternate is able to act at a meeting of
stockholders, the person presiding at the meeting shall appoint
one or more inspectors to act at the meeting.  Each inspector,
before entering upon the discharge of his duties, shall take and
sign an oath faithfully to execute the duties of inspector with
strict impartiality and according to the best of his ability.

(b)  The inspectors shall (i) ascertain the number of shares
outstanding and the voting power of each, (ii) determine the
shares represented at a meeting and the validity of proxies and
ballots, (iii) count all votes and ballots, (iv) determine and
retain for a reasonable period a record of the disposition of
any challenges made to any determination by the inspectors, and
(v) certify their determination of the number of shares
represented at the meeting, and their count of all votes and
ballots.  The inspectors may appoint or retain other persons or
entities to assist the inspectors in the performance of the
duties of the inspectors. 

(c)  The date and time of the opening and the closing of the
polls for each matter upon which the stockholders will vote at a
meeting shall be announced at the meeting.  No ballot, proxies
or votes, nor any revocations thereof or changes thereto, shall
be accepted by the inspectors after the closing of the polls
unless the Court of Chancery upon application by a stockholder
shall determine otherwise.

(d)  In determining the validity and counting of proxies and
ballots, the inspectors shall be limited to an examination of
the proxies, any envelopes submitted with those proxies, any
information provided in accordance with clause (b) of Section
2.5 of these Bylaws, ballots and the regular books and records
of the Corporation, except that the inspectors may consider
other reliable information for the limited purpose of
reconciling proxies and ballots submitted by or on behalf of
banks, brokers, their nominees or similar persons which
represent more votes than the holder of a proxy is authorized by
the record owner to cast or more votes than the stockholder
holds of record.  If the inspectors consider other reliable
information for the limited purpose permitted herein, the
inspectors at the time they make their certification pursuant to
subsection (b)(v) of this Section shall specify the specific
information considered by them including the person or persons
from whom they obtained the information, when the 
information was obtained, the means by which the information was
obtained and the basis for the inspectors' belief that the
information is accurate and reliable.

ARTICLE III - THE BOARD OF DIRECTORS

3.1. Powers, Number and Classification of Directors.  The business
and affairs of the Corporation shall be managed by or under the direction
of the Board of Directors, which may exercise all such powers of the
Corporation and do all such acts and things as are not prohibited by the
General Corporation Law of the State of Delaware nor by the Certificate of
Incorporation nor by these Bylaws directed or required to be exercised or
done by the stockholders.  The number of Directors of the Corporation
shall not be less than five (5) or more than fifteen (15) and such number
may be fixed from time to time by a majority vote of the Directors then in
office.  The Board of Directors shall be divided into three classes as
nearly equal in number as may be, with the term of office of one class
expiring each year.  When the number of Directors is changed, any increase
or decrease in directorships shall be apportioned among the classes at the
next annual meeting of stockholders so as to make all classes as nearly
equal in number as possible.  Subject to the foregoing, at each annual
meeting of stockholders the successors to the class of Directors whose
term shall then expire shall be elected to hold office for a term expiring
at the third succeeding annual meeting, and each Director shall be elected
to serve until his successor shall be elected and shall qualify.

3.2. Vacancies.  If the office of any Director or Directors becomes
vacant by reason of death, resignation, retirement, disqualification,
removal from office, creation of a new directorship, or otherwise, a
majority of the remaining Directors, though less than a quorum, shall
choose a successor or successors, or a Director to fill the newly created
directorship.  In no event shall the shareholders have the right to fill
such vacancies.

3.3. Place of Meetings.  The Directors may hold their meetings either
outside of Delaware or at the office of the Corporation in the City of
Kenosha, State of Wisconsin, or at such other places as they may from time
to time determine.

3.4. Regular Meetings.  There shall be five (5) regular meetings of
the Board of Directors in each  year, the first to be held, without other
notice than this Bylaw, immediately following and at the same place as the
annual meeting of stockholders.  Subsequent regular meetings of the Board
of Directors shall be held on the fourth Fridays of June, August, October,
January and on the date of the annual meeting of stockholders, or at such
other times as are prescribed by the Board of Directors.  Notice of
additional regular meetings, unless waived, shall be given by mail,
telegram, telecopier, telex, telephone or in person to each Director, at
his address as the same may appear on the records of the Corporation, or
in the absence of such address, at his residence or usual place of 
business, at least three (3) days before the day on which the meeting is
to be held. 

3.5. Special Meetings.  Special meetings of the Board of Directors
may be held any time on the call of the Chief Executive Officer or at the
request in writing of a majority of the members of the Board of Directors
then in office.  Notice of each special meeting, unless waived, shall be
given by mail, telegram, telecopier, telex, telephone or in person to each
Director at his address as the same appears on the records of the
Corporation not less than one day prior to the day on which the meeting is
to be held if the notice is by telegram, telecopier, telex, telephone or
in person, and not less than two days prior to the day on which the 
meeting is to be held if the notice is by mail; provided, however, that 
for purposes of dealing with an emergency situation, as conclusively
determined by the Officer or Directors calling the meeting, notice may be
given not less than two hours prior to the meeting.  Notice of any special
meeting need not state the purpose thereof.  If the Secretary shall fail
or refuse to give such notice, then the notice may be given by the Officer
or any one of the Directors making the call.  Attendance at any meeting of
the Board of Directors shall constitute waiver of notice thereof unless
the Director attends the meeting for the express purpose of objecting, and
the Director objects at the beginning of the meeting, to the transaction
of any business because the meeting was not lawfully called or convened.

3.6. Quorum; Voting.  At all meetings of the Board, a majority of the
total number of Directors then fixed pursuant to Section 3.1 of these
Bylaws shall be necessary and sufficient to constitute a quorum for the
transaction of  business, and the act of a majority of the Directors
present at any meeting at which there is a quorum shall be the act of the
Board of Directors, except as may be otherwise specifically provided by
statute or by the Certificate of Incorporation or by these Bylaws.  In the
absence of a quorum, a majority of the Directors present may adjourn the
meeting from time to time until a quorum shall be present.  Notice of any
adjourned meeting need not be given, except that notice shall be given to
all Directors if the adjournment is for more than thirty (30) days.

3.7. Quorum During Emergency.  During any emergency period following
a national catastrophe, due to enemy attack, a majority of the surviving
members of the Board, but in any case not less than five, who have not
been rendered incapable of acting due to physical or mental incapacity or
due to the difficulty of transportation to the place of the meeting shall
constitute a quorum for the purpose of filling vacancies in the Board of
Directors and among the elected and appointed Officers of the Corporation.

3.8. Informal Action.  Any action required or permitted to be taken
at any meeting of the Board of Directors or any Committee thereof may be
taken without a meeting, if a written consent to such action is signed by
all members of the Board or of such Committee, as the case may be, and
such written consent is filed with the minutes of proceedings of the Board
or Committee.

3.9. Meeting by Telephone.  Members of the Board of Directors, or any
Committee designated by the Board, may participate in a meeting of the
Board or Committee by means of conference telephone or similar
communications equipment by means of which all persons participating 
in the meeting can hear each other, and participation in a meeting 
pursuant to this section shall constitute presence in person at
the meeting.

3.10.  Compensation.  Directors, as such, may receive compensation
for their services and/or such fixed sums and expenses of attendance for
attendance at each regular or special meeting of the Board of Directors as
may be established by resolution of the Board; provided that nothing
herein contained shall be construed to preclude any Director from serving
the Corporation in any other capacity and receiving compensation therefor. 
Members of Committees may be allowed like compensation for attending
Committee meetings.  The Board Affairs and Nominating Committee shall
annually recommend to the Board of Directors the appropriate compensation
for the members of the Board of Directors.

3.11.     Committees.  Based upon the recommendations of the Board
Affairs and Nominating Committee, the Board of Directors may, by
resolution or resolutions passed by a majority of the total number of
Directors then fixed pursuant to Section 3.1 of these  Bylaws, designate
one or more Committees, each Committee to consist of one or more of the
Directors of the Corporation, which Committees, to the extent provided in
said resolution or resolutions, shall have and may exercise the powers of
the Board of Directors in the management of the business and affairs of
the Corporation between meetings of the Board of Directors.  The members
and the Chairman of each Committee shall be appointed, and may be removed
at any time, by resolution adopted by a majority of the total number of
Directors then fixed pursuant to Section 3.1 of these Bylaws.  No such
Committee shall have the power or authority to authorize amending the
Certificate of Incorporation, adopt an agreement of merger or
consolidation, recommend to the stockholders the sale, lease or exchange
of all or substantially all of the Corporation's property and assets,
recommend to the stockholders a dissolution of the Corporation or a
revocation of a dissolution, or amend the Bylaws of the Corporation; and,
unless the resolution, Bylaws, or Certificate of Incorporation expressly
so provide, no Committee shall have the power or authority to declare a
dividend or to authorize the issuance of stock.  Such Committee or
Committees shall have such name or names as may be determined from time to
time by resolution adopted by the Board of Directors.  Each Committee
shall keep minutes of its proceedings, and shall report to the Board of
Directors when required by the Board.

ARTICLE IV - OFFICERS

4.1. Election and Removal of Chairman of the Board of Directors.  At
the regular meeting of the Directors held after the annual stockholders'
meeting in each year, one of the Directors shall be elected to be the
Chairman of the Board of Directors, which person may be removed from this
position at any time by a majority vote of the total number of Directors
then fixed pursuant to Section 3.1 of these Bylaws whenever in their
judgment the best interests of the Corporation will be served by such
action.

4.2. Duties of the Chairman of the Board of Directors.  The Chairman
of the Board of Directors shall preside at all meetings of the
stockholders and of the Directors.  If he is also the Chief Executive
Officer, he shall carry out those duties as designated herein.  If he is
not the Chief Executive Officer, he shall have no authority for the
management and control of the business and affairs of the Corporation
other than in his capacity as a Director.

4.3. Officers.  As contained within these Bylaws, except as otherwise
provided for, all references to "Officers" shall apply to both Elected and
Appointed Officers.  The Elected Officers of the Corporation shall be a
President, a Chief Executive Officer, a Chief Operating Officer, one or
more Senior or Executive Vice Presidents, a Secretary, a Treasurer, a
Controller, a Chief Financial Officer, a Vice President - Information
Services and a Vice President - Human Resources.  These Officers, and any
other Officers which the Directors deem should be elected, shall be
elected by the Directors at the regular meeting of the Board held after
the annual stockholders' meeting in each year and at such other times as
new elected offices are created by the Chief Executive Officer or
vacancies in such elected offices must be filled.  All other Officers of
the Corporation shall be appointed by the Chief Executive Officer, as such
appointed offices are deemed necessary by the Chief Executive Officer. 
Any two or more offices may be held by the same person. 

4.4. Removal.  Any Officer elected by the Directors may be removed
from office at any time by a majority vote of the total number of
Directors then fixed pursuant to Section 3.1 of these Bylaws whenever in
their judgment the best interests of the Corporation will be served by
such action.  Any appointed Officer may be removed at any time by the
Chief Executive Officer.

4.5. Designation of Chief Executive Officer and Chief Operating
Officer.  The Directors may, but need not, designate the Chairman of the
Board of Directors as the Chief Executive Officer.  The Directors shall
designate the President as either the Chief Executive Officer or the Chief
Operating Officer.  The Directors may, but need not, designate an
Executive Vice President as the Chief Operating Officer.  These
designations of duties may be changed at any time by a majority vote of
the total number of Directors then fixed pursuant to Section 3.1 of these
Bylaws whenever in their judgment the best interests of the Corporation
will be served by such action.

4.6. Chief Executive Officer.  The Chief Executive Officer shall
manage and control the overall business and affairs of the Corporation and
ensure that the orders and resolutions of the Directors are carried into
effect.  He shall have the authority to represent and act for the
Corporation, to sign documents binding the Corporation in all matters
except those reserved to the Directors, to authorize other Officers
designated by him to represent, act and sign for the Corporation and to
assign to the other Officers the authority for the management and control
of such business and affairs of the Corporation as he may designate.  If
the Chief Executive Officer is not a member of the Board of Directors, he
shall be, ex officio, a member of all Committees of the Board of Directors
not exercising powers of the Board other than the Audit Committee and
Organization & Executive Compensation Committee and shall have all the
same rights and duties, except the right to vote, as have all members of
the Committee.  If he is a Director he shall be, ex officio, a member of
all Committees of the Board of Directors exercising powers of the Board
other than the Audit Committee and Organization & Executive Compensation
Committee, and shall have all the same rights and duties, including the
right to vote, as have all members of the Committees.  The Chief Executive
Officer may review pertinent director compensation survey data and report
these results to the Board Affairs and Nominating Committee.

4.7. Chief Operating Officer.  The Chief Operating Officer shall have
authority for the management and control of such business and affairs of
the Corporation as shall be assigned by the Chief Executive Officer or the
Board of Directors.  In the event of the absence or disability of the
Chief Executive Officer, he shall perform those duties as designated
herein of the Chief Executive Officer.

4.8. President.  The President shall perform the duties as designated
herein of the Chief Executive Officer or the Chief Operating Officer.  In
the absence of the Chairman of the Board of Directors he shall preside at
all meetings of the stockholders and the Directors.

4.9. Executive Vice Presidents.  Executive Vice Presidents shall have
authority for the management and control of such business and affairs of
the Corporation as shall be assigned by the Chief Executive Officer or the
Board of Directors.  If an Executive Vice President is the appointed Chief
Operating Officer, he shall perform those duties as designated herein.  In
the absence or disability of the Chief Executive Officer and of the Chief
Operating Officer, an Executive Vice President designated by the Chief
Executive Officer or the Board of Directors shall perform the duties as
designated herein of the Chief Executive Officer.

4.10.  Senior Vice Presidents.  Senior Vice Presidents shall have
authority for the management and control of such business and affairs of
the Corporation as shall be assigned by the Chief Executive Officer or the
Board of Directors.  In the event that there is no individual currently
holding such office of the Chief Executive Officer, of the Chief Operating
Officer, or of the Executive Vice President, or in the event that such
individual is absent or disabled, a Senior Vice President designated by
the Chief Executive Officer or the Board of Directors shall perform the
duties as designated herein of the Chief Executive Officer.

4.11.  Chief Information Officer.  The Chief Information Officer
shall be an Elected Officer and shall have the authority for the
management and control of such business and affairs as shall be assigned
by the Chief Executive Officer or the Board of Directors.

4.12.  Chief Financial Officer.  The Chief Financial Officer shall
be an Elected Officer and shall have the authority for the management and
control of such business and affairs as shall be assigned by the Chief
Executive Officer or the Board of Directors.

4.13.  Elected Vice Presidents.  The Elected Vice Presidents shall
have authority for the management and control of such business and affairs
of the Corporation as shall be assigned by the Chief Executive Officer or
the Board of Directors.

4.14.  Appointed Officers.  Appointed Officers shall have
authority for the management and control of such business and affairs of
the Corporation as shall be assigned by the Chief Executive Officer.

4.15.  Secretary.  The Secretary shall attend all sessions of the
Board and all meetings of the stockholders and record all votes and the
minutes of all proceedings in a book  to be kept for that purpose; and
shall perform like duties for the standing Committees when required.  The
Secretary shall give, or cause to be given, notice of all meetings of the
stockholders and of the Board of Directors, and shall perform such other
duties as from time to time may be prescribed by the Board of Directors or
the Chief Executive Officer of the Corporation.  The Secretary shall keep
in safe custody the Seal of the Corporation, and when authorized by the
Board, affix it to any instrument requiring it.

4.16. Treasurer.  The Treasurer shall:

(a)  have the custody of the corporate funds and securities and
shall keep or cause to be kept full and accurate accounts of the
financial affairs of the Corporation;

(b)  deposit or cause to be deposited all moneys and other
valuable effects in the name and to the credit of the
Corporation in such depositories as may be designated by the
Board of Directors;

(c)  disburse or cause to be disbursed the funds of the
Corporation as may be ordered by the Board of Directors;

(d)  render to the Chief Executive Officer and Directors, at the
regular meetings of the Board or whenever they may require it,
an  account of all his transactions as Treasurer and of the
financial  condition of the Corporation;

(e)  give the Corporation a bond, if required by the Board of
Directors, in a sum and with one or more sureties satisfactory
to the Board, for the faithful performance of the duties of his
office; and

(f)  perform all the duties incident to the office of Treasurer

and  such other duties as from time to time may be prescribed by
the Board of Directors or by the Chief Executive Officer of the
Corporation.

4.17.  Controller.  The Controller shall maintain proper audit
control over the operations of the Corporation and be generally
responsible for the accounting system employed by the Corporation and the
accounting practices adopted by the various departments; he shall direct
the budgetary control, general accounting, cost accounting and statistical
activities of the Corporation; and he shall supervise activities in
connection with credits and collections, taxes and physical inventories. 
The Controller shall prepare and furnish such reports and statements
showing the financial condition of the Corporation as shall be required of
him by the Chief Executive Officer or the Board of Directors, and shall
perform such other duties as the Chief Executive Officer or the Board of
Directors shall prescribe.

4.18.  Delegation of Duties.  In the case of the absence,
incapacity, or inability to serve of any Elected Officer of the
Corporation, the Board may delegate, for so long as may be necessary, the
powers or duties, or any of them, of the Elected Officer to any other
Elected Officer, or to any Director provided a majority of the total
number of Directors then fixed pursuant to Section 3.1 of these Bylaws
concurs therein.  In the case of the absence, incapacity, or inability to
serve of any Appointed Officers of the Corporation, the Chief Executive
Officer may delegate, for so long as may be necessary, the powers or
duties, or any of them, of that appointed Officer to any Elected or
Appointed Officer.

4.19.  Compensation.  The compensation, if any, of the Chairman of
the Board of Directors, the President, the Chief Executive Officer and the
Chief Operating Officer shall be fixed by the Directors after reviewing
the recommendations of the Organization and Executive Compensation
Committee.  The compensation of all other Officers shall be fixed by
Organization and Executive Compensation Committee in consultation with the
Chief Executive Officer.

4.20.  Bonds.  If the Board of Directors or the Chief Executive
Officer shall so require, any Officer or agent of the Corporation shall
give bond to the Corporation in such amount and with such surety as the
Board of Directors or the Chief Executive Officer, as the case may be, may
deem sufficient, conditioned upon the faithful performance of their
respective duties and offices.

ARTICLE V - CERTIFICATES OF STOCK AND THEIR TRANSFER

5.1. Regulation.  Subject to the terms of any contract of the
Corporation, the Board of Directors may make such rules and regulations as
it may deem expedient concerning the issue, transfer and registration of
certificates for shares of stock of the Corporation, including the
issuance of new certificates for lost or destroyed certificates, and
including the appointment of transfer agents and registrars.

5.2. Form of Certificates.  The certificates of stock of the
Corporation shall be numbered and shall be entered in the books of the
Corporation as they are issued.  They shall exhibit the holder's name and
number of shares and shall be signed by the Chairman of the Board, the
President or an Elected or Appointed Vice President, and the Treasurer, or
the Secretary.  If the Corporation has a transfer agent or an assistant
transfer agent or a transfer clerk acting on its behalf and a registrar,
the signature of any officer may be facsimile.  Facsimile signatures may
be of the Officers of the Corporation designated above who are Officers at
the time of the issuance of the certificates or who were such at the time
of the printing or engraving of the certificates whether or not the person
has continued to hold that office.  The designations, preferences and
relative participating, optional or other special rights of each class of
stock or series thereof and the qualifications, limitations, or
restrictions of the preferences and/or rights shall be set forth in full
or summarized on the face or back of the certificate which the Corporation
shall issue to represent the class or series of stock, provided that,
except as provided to the contrary by the General Corporation Law of the
State of Delaware, in lieu of the foregoing requirements there may be set
forth on the certificate a statement that the Corporation will furnish
without charge to each stockholder who so requests the preferences and
rights and qualifications, limitations or restrictions.

5.3. Transfer of Certificates.  Shares of the capital stock of the
Corporation shall be transferable on the books of the Corporation by the
holder thereof in person or by his duly authorized attorney, upon the
surrender or cancellation of a certificate or certificates for a like
number of shares.  As against the Corporation, a transfer of shares can be
made only on the books of the Corporation and in the  manner hereinabove
provided, and the Corporation shall be entitled to treat the registered
holder of any share as the owner thereof and shall not be bound to
recognize any equitable or other claim to or interest in such share on the
part of any other person, whether or not it shall have express or other
notice thereof, save expressly provided by the statutes of the State of
Delaware.

5.4. Record Date.  

(a)  If no record date is fixed pursuant to Section 5.6 of these
Bylaws, the record date for determining stockholders entitled to
notice of or to vote at a meeting of stockholders shall be at
the close of business on the day next preceding the day on which
notice is given, or, if notice is waived, at the close of
business on the day next preceding the day on which the meeting
is held.  A determination of stockholders of record entitled to
notice of or to vote at a meeting of stockholders shall apply to
any adjournment of the meeting; provided, however, that the 
Board of Directors may fix a new record date for the adjourned
meeting.

(b)  In order that the Corporation may determine the
stockholders entitled to consent to corporate action in writing
without a meeting, the Board of Directors may fix a record date,
which record date shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of
Directors, and which date shall not be more than ten (10) days
after the date upon which the resolution fixing the record date
is adopted by the Board of Directors.  Any stockholder of record
seeking to have the stockholders authorize or take corporate
action by written consent shall, by written notice to the
Secretary, request the Board of Directors to fix a record date. 
The Board of Directors shall promptly, but in all events within
ten (10) days after the date on which such a request is
received, adopt a resolution fixing the record date.  If no
record date has been fixed by the Board of Directors within ten
(10) days of the date on which such a request is received, the
record date for determining stockholders entitled to consent to
corporate action in writing without a meeting, when no prior
action by the Board of Directors is required by applicable law,
shall be the first date thereafter on which a signed written
consent setting forth the action taken or proposed to be taken
is delivered to the Corporation by delivery to its registered
office in the State of Delaware, its principal place of
business, or an officer or agent of the Corporation having
custody of the book in which proceedings of stockholders
meetings are recorded, to the attention of the Secretary of the
Corporation.  Delivery shall be by hand or by certified or
registered mail, return receipt requested.  If no record date
has been fixed by the Board of Directors and prior action by the
Board of Directors is required by applicable law, the record
date for determining stockholders entitled to consent to
corporate action in writing without a meeting shall be at the
close of business on the date on which the Board of Directors
adopts the resolution taking such prior action.

5.5. Lost or Destroyed Certificates.  Any person claiming a
certificate of stock to be lost or destroyed shall make an affidavit or
affirmation of that fact and advertise the same in such manner as the
Board of Directors may require, and the Board of Directors may, in its
discretion, require the owner of the lost or destroyed certificate or his
legal representative to give the Corporation a bond, in such sum as it may
direct, not exceeding double the value of the stock, to indemnify the
Corporation against any claim that may be made against it on account of
the alleged loss of any such certificate; a new certificate of the same
tenor and for the same number of shares as the one alleged to be lost or
destroyed may be issued without requiring any bond when, in the judgment
of the Directors, it is proper to do so.

5.6. Stock Transfer Books; Record Date.  The Board of Directors shall
have power to close the stock transfer books of the Corporation for a
period not exceeding sixty (60) days preceding the date of any meeting of
stockholders or the date for payment of any dividend or the date for the
allotment of rights or the date when any change or conversion or exchange
of capital stock shall go into effect provided, however, that in lieu of
closing the stock transfer books as aforesaid the Board of Directors may
by resolution fix a date, not preceding the date of the resolution, not
more than sixty (60) nor less than ten (10) days preceding the date of any
meeting of stockholders or not more than sixty (60) days preceding the
date for the payment of any dividend, or the date for the allotment of
rights, or the date when any change or conversion or exchange of capital
stock shall go into effect, as a record date for the determination of the
stockholders entitled to notice of, and to vote at, any such meeting, or
entitled to receive payment of any such dividend, or to any such allotment
of rights, or to exercise the rights in respect of any such change,
conversion or exchange of capital stock, and in such case such
stockholders of record on the date so fixed shall be entitled to such
notice of, and to vote at such meeting, or to receive payment of such
dividend, or to receive such allotment of rights, or to exercise such
rights, as the case may be, notwithstanding any transfer of any stock on
the books of the Corporation after any such record date fixed as
aforesaid.

5.7. Consent of Stockholders in Lieu of Meeting.  In the event of the
delivery to the Corporation of a written consent or consents purporting to
authorize or take corporate action and/or related revocations (each such
written consent and any revocation thereof is referred to in this Section
5.7 as a "Consent"), the Secretary of the Corporation shall provide for
the safekeeping of such Consents and shall as soon as practicable
thereafter conduct such reasonable investigation as he or she deems
necessary or appropriate for the purpose of ascertaining the validity of
such Consents and all matters incident thereto, including, without
limitation, whether the holders of shares having the requisite voting
power to authorize or take the action specified in the Consents have given
consent; provided, however, that if the corporate action to which the
Consents relate is the removal or election of one or more members of the
Board of Directors, the Secretary of the Corporation shall designate an
independent, qualified inspector with respect to such Consents and such
inspector shall discharge the functions of the Secretary of the
Corporation under this Section 5.7.  If after such investigation the
Secretary or the inspector (as the case may be) shall determine that any
action purportedly taken by such Consents has been validly taken, that
fact shall be certified on the records of the Corporation kept for the
purpose of recording the proceedings of meetings of the stockholders and
the Consents shall be filed with such records.  In conducting the
investigation required by this Section 5.7, the Secretary or the inspector
may, at the expense of the Corporation, retain to assist them special
legal counsel and any other necessary or appropriate professional
advisors, and such other personnel as they may deem necessary or
appropriate.

ARTICLE VI - BOOKS AND ACCOUNTS

6.1. Location.  The books, accounts, and records of the Corporation
may be kept at such place or places within or without the State of
Delaware as the Board of Directors may from time to time determine. 

6.2. Inspection.  The books, accounts, and records of the Corporation
shall be open to inspection by any member of the Board of Directors during
usual business hours for any purpose reasonably related to the Director's
position as a Director; and open to inspection by the stockholders at such
times, and subject to such regulations, as the Board of Directors may
prescribe, except as otherwise provided by statute.

ARTICLE VII - CHECKS, NOTES, CONTRACTS, ETC.

7.1. Checks; Notes.  All checks or demands for money and notes of the
Corporation shall be signed by such Officer or Officers or such other
person or persons as the Board of Directors may from time to time
designate.

7.2. Execution of Corporate Contracts.  Except as otherwise provided
by the Board of Directors or the Executive Committee, all contracts of the
corporation shall be executed on its behalf by the President, an Elected
or Appointed Vice President or such other person or persons as the
President or Vice President may from time to time authorize so to do. 
Whenever the Board of Directors or the Executive Committee shall provide
that any contract be executed or any other act be done in any other manner
and by any other officer or agent than as specified in the Bylaws, such
method or execution or action shall be as equally effective to bind the
Corporation as if specified herein.

ARTICLE VIII - MISCELLANEOUS

8.1. Fiscal Year.  The fiscal year shall end on the Saturday nearest
December 31.

8.2. Corporate Seal.  The Corporate Seal shall have inscribed thereon
the name of the Corporation, and the words "Corporate Seal, Delaware." 
Said Seal may be used by causing it or a facsimile thereof to be impressed
or affixed or reproduced or otherwise.

8.3. Notice.  Any notice required to be given under the provisions of
these Bylaws to any Director, Officer or stockholder may be given in
writing, by depositing the same in the United States mail, postage
pre-paid, addressed to the stockholder, Officer or Director at his or her
address appearing on the books of the Corporation, and the notice shall be
deemed to be given at the time when so mailed; provided that no notice
need be given to any stockholder to whom (i) notice of two consecutive
annual meetings, and all notices of meetings or of the taking of action by
written consent without a meeting to such person during the period between
the two (2) consecutive annual meetings, or (ii) all, and at least two,
payments (if sent by first class mail) of dividends during a twelve (12)
month period, have been mailed addressed to such stockholder at his
address as shown on the records of the Corporation and have been returned
undeliverable.

8.4. Waiver of Notice.  Any stockholder, Director or Officer may
waive any notice required to be given under these Bylaws, in writing
signed by the person entitled to notice, either before or after the
meeting.

8.5. Voting of Stock in Other Corporations.  Any shares of stock in
any other corporation which may from time to time be held by this
Corporation may be represented and voted at any meeting of shareholders of
such corporation by the Chief Executive Officer or an Elected or Appointed
Vice President, or by any other person or persons thereunto authorized by
the Board of Directors, or by any proxy designated by written instrument
of appointment executed in the name of this Corporation by its Chief
Executive Officer or an Elected or Appointed Vice President.  Shares of
stock belonging to the Corporation need not stand in the name of the
Corporation, but may be held for the benefit of the Corporation in the
individual name of the Treasurer or of any other nominee designated for
the purpose by the Board of Directors.  Certificates for shares so held
for the benefit of the Corporation shall be endorsed in blank or have
proper stock powers attached so that said certificates are at all times in
due form for transfer, and shall be held for safekeeping in such manner as
shall be determined from time to time by the Board of Directors.

ARTICLE IX - INDEMNIFICATION

9.1. Eligibility; Expenses.  Each director and officer of the
Corporation (collectively, the "Indemnitees") who was or is a party or is
threatened to be made a party to or is involved in any action, suit or
proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he, or a person
of whom he is the legal representative, is or was a Director or Officer of
the Corporation or is or was serving at the request of the Corporation as
a Director, Officer, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service
with respect to employee benefit plans, shall be indemnified and held
harmless by the Corporation to the fullest extent permitted by the laws of
Delaware against all costs, charges, expenses, liabilities and losses
(including attorneys' fees, judgments, fines, ERISA excise taxes or
penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by such Indemnitees in connection therewith.  The
right to indemnification conferred in this Section shall be a contract
right.  Each Indemnitee shall have the right to be paid by the Corporation
the expenses incurred in defending any such proceeding, except the amount
of any settlement, in advance of such proceeding's final disposition upon
receipt by the Corporation of an undertaking, by or on behalf of such
Indemnitee, to repay all amounts so advanced if it shall ultimately be
determined that the Indemnitee is not entitled to be indemnified under
this Section or otherwise.  The Corporation may, by action of its Board of
Directors, indemnify and hold harmless employees and agents of the
Corporation to the fullest extent permitted by the laws of Delaware
against all costs, charges, expenses, liabilities and losses (including
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and
amounts paid or to be paid in settlement) reasonably incurred or suffered
by such  employees and agents in connection therewith.  The Corporation
may pay expenses of any employee or agent of the Corporation incurred in
defending any such proceeding, except the amount of any settlement, in
advance of such proceeding's final disposition upon such terms and
conditions, if any, as the Board of Directors of the Corporation deems
appropriate.

9.2. Suit to Collect.  If a claim under Section 9.1 above is not paid
in full by the Corporation within thirty (30) days after a written claim
has been received by the Corporation, the claimant may at any time
thereafter bring suit against the Corporation to recover the unpaid amount
of the claim and, if successful in whole or in part, the claimant shall
also be entitled to be paid the expense of prosecuting such claim.  It
shall be a defense to any action (other than an action brought to enforce
a claim for expenses incurred in defending any proceeding in advance of
its final disposition where the required undertaking has been tendered to
the Corporation) that the claimant has failed to meet a standard of
conduct which makes it permissible under Delaware law for the Corporation
to indemnify the claimant for the amount claimed.  Neither the failure of
the Corporation (including its Board of Directors, independent legal
counsel, or its stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant is
permissible in the circumstances because he has met such standard of
conduct, nor an actual determination by the Corporation (including its
Board of Directors, independent legal counsel, or its stockholders) that
the claimant has not met such standard of conduct, nor the termination of
any proceeding by judgment, order, settlement, conviction or upon a plea
of nolo contendere or its equivalent, shall be a defense to the action or
create a presumption that the claimant has failed to meet the required
standard of conduct.  

9.3. Nonexclusivity of Rights.  The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its
final disposition conferred in these Bylaws shall not be exclusive of any
other right which any person may have or hereafter acquire under any
statute, provision of the Certificate of Incorporation, Bylaw, agreement,
vote of stockholders or disinterested Directors or otherwise.

9.4. Insurance.  The Corporation may maintain insurance, at its
expense, to protect itself and any Director, Officer, employee or agent of
the Corporation or another corporation, partnership, joint venture, trust
or other enterprise against any expense, liability or loss, whether or not
the Corporation would have the power to indemnify such person against such
expense, liability or loss under Delaware law.  

9.5. Expenses as a Witness.  To the extent that any Director,
Officer, employee or agent of the Corporation is by reason of such
position, or a position with another entity at the request of the
Corporation, a witness in any proceeding, he shall be indemnified against
all costs and expenses actually and reasonably incurred by him or on his
behalf in connection therewith.  

9.6. Indemnity Agreements.  The Corporation may enter into indemnity
agreements with the persons who are members of its Board of Directors from
time to time, and with such Officers, employees and agents as the Board
may designate, providing in substance that the Corporation shall indemnify
such persons to the fullest extent permitted by Delaware law.  

9.7. Continuation of Rights.  The indemnification and advancement of
expenses provided by this Article IX shall continue as to a person who has
ceased to be a Director, Officer, employee or agent of the Corporation and
shall inure to the benefit of the heirs, executors and administrators of
such a person.

9.8. Amendment.  Any amendment, repeal or modification of any
provision of this Article IX by the stockholders or the Directors of the
Corporation shall not adversely affect any right or protection of a
Director or Officer of the Corporation existing at the time of such
amendment, repeal or modification. 

ARTICLE X - AMENDMENT OF BYLAWS

10.1.   Amendment.  The Board of Directors, by affirmative vote of
a majority of the total number of Directors then fixed pursuant to Section
3.1 of these Bylaws, may adopt, amend, or repeal these Bylaws at any
meeting, subject to the provisions of Article Seventh of the Certificate
of Incorporation.  Subject to the provisions of Article Seventh of the
Certificate of Incorporation, these Bylaws may also be amended or
repealed, and new Bylaws adopted, by the stockholders; provided, however,
that any amendment or repeal of Section 2.7, Section 2.9, Section 3.2 or
Section 10.1 hereof may be made only by vote of at least seventy-five
percent (75%) of the issued and outstanding common stock of the
Corporation of the shares entitled to vote thereon at any annual meeting
or special meeting of stockholders, and only if notice of the proposed
amendment or repeal is contained in the notice of the meeting.

AMENDED AND RESTATED
SNAP-ON INCORPORATED
1986 INCENTIVE STOCK PROGRAM
(As Amended April 26, 1996)

Purpose.  The purpose of the Amended and Restated Snap-on
Incorporated 1986 Incentive Stock Program (the "Program") is to attract
and retain outstanding people as officers and key employees of Snap-on
Incorporated (the "Company") and its subsidiaries and entities of which at
least 20% of the equity interest is held directly or indirectly by the
Company (together, "Affiliates") and to furnish incentives to such persons
by providing such persons opportunities to acquire shares ("Shares") of
the Company's common stock ("Common Stock"), or monetary payments based on
the value of such Common Stock or the financial performance of the
Company, or both, on terms as herein provided.

Administration.  The Program will be administered by a committee
(the "Committee") of the Board of Directors of the Company (the "Board")
composed of not less than two Directors, each of whom shall qualify as a
"disinterested person" for purposes of Rule 16b-3 ("Rule 16b-3") under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and as
an "outside director" under Section 162(m)(4)(C) of the Internal Revenue
Code of 1986, as amended (the "Code") (or any successor provision
thereto).  To the extent permitted by applicable law, the Board may, in
its discretion, delegate to another committee of the Board or to one or
more senior officers of the Company any or all of the authority and
responsibility of the Committee with respect to Benefits (as defined
below) to Participants other than Participants who are subject to the
provisions of Section 16 of the Exchange Act ("Section 16 Participants")
at the time any such delegated authority or responsibility is exercised. 
To the extent that the Board has delegated to such other committee or one
or more officers the authority and responsibility of the Committee, all
references to the Committee herein shall include such other committee or
one or more officers.  The Committee shall interpret the Program,
prescribe, amend and rescind rules and regulations relating thereto and
make all other determinations necessary or advisable for the
administration of the Program.  A majority of the members of the Committee
shall constitute a quorum and all determinations of the Committee shall be
made by a majority of its members.  Any determination of the Committee
under the Program may be made without notice or meeting of the Committee
by a writing signed by a majority of the Committee members.

Participants.  Participants in the Program ("Participants") will
consist of such officers or other key employees of the Company and its
Affiliates as the Committee in its sole discretion may designate from time
to time to receive benefits described in Section 4 hereof ("Benefits"). 
The Committee's designation of a Participant in any year shall not require
the Committee to designate such person to receive a Benefit in any other
year.  The Committee shall consider such factors as it deems pertinent in
selecting Participants and in determining the type and amount of their
respective Benefits, including without limitation (i) the financial
condition of the Company; (ii) anticipated profits for the current or
future years; (iii) contributions of Participants to the profitability and
development of the Company; and (iv) other compensation provided to
Participants.

4.   Types of Benefits.

(a)  The Committee shall have full power and authority to (i)
determine the type or types of Benefits to be granted to each Participant
under the Program; (ii) determine the number of Shares and/or monetary
payments to be covered by (or with respect to which payments, rights or
other matters are to be calculated in connection with) Benefits granted to
Participants; and (iii) determine any terms and conditions of any Benefit
granted to a Participant, subject in each case only to express
requirements of the Program.  Benefits under the Program may be granted in
any one or a combination of (A) incentive stock options granted under
Section 6 hereof and intended to meet the requirements of Section 422 of
the Code (or any successor provision thereto) ("Incentive Stock Options");
(B) options granted under Section 7 hereof not intended to be Incentive
Stock Options ("Non-Qualified Stock Options"); (C) stock appreciation
rights granted pursuant to Section 9 hereof ("Stock Appreciation Rights");
(D) Shares granted under Section 10 hereof to be held subject to certain
restrictions ("Restricted Stock") and Bonus Shares (are defined in Section
11) delivered pursuant to Section 11; (E) Shares granted under Section 12
hereof ("Performance Shares"); and (F) monetary units granted under
Section 13 hereof ("Performance Units").  For purposes hereof, Incentive
Stock Options and Non-Qualified Stock Options shall be hereinafter
referred to collectively as "Options".  Benefits under the Program may be
granted either alone or in addition to, in tandem with, or in substitution
for any other Benefit or any other award or benefit granted under any
other plan of the Company or any Affiliate.  Benefits granted in addition
to or in tandem with other awards or benefits may be granted either at the
same time as or at different times from grants of such other Benefits or
other awards.

(b)  Each member of the Board (a "Director") who is not also an
employee of the Company shall receive Director Options (as defined in
Section 14) under the Program as provided in Section 14.

(c)  As used in the Plan, the term "Award" shall mean any
Benefit or Director Option granted under the Program.

5.   Shares Reserved under the Program.  

(a)  There is hereby reserved for issuance under the Program
after the Effective Date (as defined below) an aggregate of Four Million
(4,000,000) Shares, consisting of Shares (i) newly authorized effective
upon approval of this Program, as amended and restated, by the Company's
shareholders at a meeting duly called and held (the "Effective Date"),
(ii) previously reserved for issuance under the Program as to which
Benefits could be awarded under this Program immediately prior to the
Effective Date and (iii) subject to awards of Benefits that are
outstanding immediately prior to the Effective Date.  Not more than
200,000 Shares reserved for issuance under the Program after the Effective
Date may be issued as Restricted Stock.

(b)  If there is a lapse, expiration, termination or
cancellation of any Award granted hereunder without the issuance of Shares
or payment of cash thereunder, if Shares are issued under any Award and
thereafter are reacquired by the Company pursuant to rights reserved upon
the issuance thereof, or if previously owned Shares are delivered to the
Company in payment of the exercise price of an Award, then the Shares
subject to, reserved for or delivered in payment in respect of such Award
may again be used for new Options or other Awards of any sort authorized
under this Program.

(c)  No Participant shall be granted Benefits under the Program
that could result in such Participant (i) receiving in any single fiscal
year of the Company Options for, and/or Stock Appreciation Rights with
respect to, more than 300,000 Shares, (ii) receiving Benefits in any
single fiscal year of the Company relating to more than 150,000 Shares of
Restricted Stock, (iii) receiving more than 150,000 Performance Shares in
respect of any period designated under Section 12 or (iv) receiving
Performance Units exceeding $1,000,000 in value in respect of any period
designated under Section 13.  Such number of Shares as specified in the
preceding sentence shall be subject to adjustment in accordance with the
terms of Section 18(a) hereof.  In all cases, determinations under this
Section 5 shall be made in a manner that is consistent with the exemption
for performance-based compensation provided by Section 162(m) of the Code
(or any successor provision thereto) and any regulations promulgated
thereunder.

6.   Incentive Stock Options.  Incentive Stock Options will be
exercisable at purchase prices of not less than One Hundred percent (100%)
of the fair market value of the Shares on the date of grant, as such fair
market value is determined by such methods or procedures as shall be
established from time to time by the Committee ("Fair Market Value"). 
Incentive Stock Options will be exercisable over not more than ten (10)
years after date of grant and shall terminate not later than three (3)
months after termination of employment for any reason other than death,
except as otherwise provided by the Committee.  If the Participant should
die while employed or within three (3) months after termination of
employment, then the right of the Participant's successor in interest to
exercise an Incentive Stock Option shall terminate not later than twelve
(12) months after the date of death, except as otherwise provided by the
Committee.  In all other respects, the terms of any Incentive Stock Option
granted under the Program shall comply with the provisions of Section 422
of the Code (or any successor provision thereto) and any regulations
promulgated thereunder.

7.   Non-Qualified Stock Options.  Non-Qualified Stock Options will
be exercisable at purchase prices of not less than One Hundred percent
(100%) of the Fair Market Value of the Shares on the date of grant.  Non-
Qualified Stock Options will be exercisable as determined by the Committee
over not more than fifteen (15) years after the date of grant and shall
terminate six (6) months after termination of employment for any reason
other than death, except that, subject to the maximum term of fifteen (15)
years, (a) in connection with the termination of a Participant's
employment in a manner that entitles the Participant immediately to
receive the payment of benefits under any defined benefit retirement plan
of the Company or any of its Affiliates ("Retirement"), a Non-Qualified
Stock Option shall terminate three (3) years after Retirement and (b) the
Committee may provide otherwise in connection with any termination of
employment, including Retirement.  If the Participant should die while
employed or within any period after termination of employment during which
the Non-Qualified Stock Option was exercisable, then, subject to the
maximum term of fifteen (15) years, the right of the Participant's
successor in interest to exercise a Non-Qualified Stock Option shall
terminate not later than twelve (12) months after the date of death,
except as otherwise provided by the Committee.

8.   Certain Replacement Options.  Without in any way limiting the
authority of the Committee to make grants of Options to Participants
hereunder, and in order to induce Participants to retain ownership of
Shares acquired upon the exercise of Options, the Committee shall have the
authority (but not an obligation) to include within any agreement setting
forth the terms of any Options (or any amendment thereto) a provision
entitling a Participant to further Options ("Replacement Options") in the
event the Participant exercises any Options (including a Replacement
Option) under the Program, in whole or in part, by surrendering previously
acquired Shares.  Any such Replacement Options shall (a) be Non-Qualified
Stock Options under Section 7, exercisable at a purchase price, unless
otherwise determined by the Committee, of 100% of the Fair Market Value of
the Shares on the date the Replacement Options are granted, (b) be for a
number of Shares equal to the number of Shares surrendered, (c) only
become exercisable on the terms specified by the Committee in the event
the Participant holds, for a minimum period of time prescribed by the
Committee, the Shares the Participant acquired upon the exercise in
connection with which the Replacement Options were issued, and (d) be
subject to such other terms and conditions as the Committee may determine.

9.   Stock Appreciation Rights.  The Committee is hereby authorized
to grant Stock Appreciation Rights to Participants.  Subject to the terms
of the Program and any applicable agreement with a Participant, a Stock
Appreciation Right granted under the Program shall confer on the holder
thereof a right to receive, upon exercise thereof, the excess of (a) the
Fair Market Value of one Share (determined on the date the Stock
Appreciation Right is exercised) over (b) the grant price of the Stock
Appreciation Right as specified by the Committee, which shall, unless
otherwise determined by the Committee, be 100% of the Fair Market Value of
one Share (determined on the date of grant of the Stock Appreciation
Right).  Subject to the terms of the Program, the grant price, term,
calculation of Fair Market Value, methods of exercise, methods of
settlement (including whether the Participant will be paid in cash,
Shares, other securities, other Benefits or other property, or any
combination thereof), and any other terms and conditions of any Stock
Appreciation Right shall be as determined by the Committee.  The Committee
may impose such conditions or restrictions on the exercise of any Stock
Appreciation Right as it may deem appropriate, including, without
limitation, restricting the time during which a Participant may exercise a
Stock Appreciation Right to specified periods as may be necessary to
satisfy the requirements of Rule 16b-3.

10.  Restricted Stock.  

(a)   The Committee is hereby authorized to issue Restricted
Stock to Participants, with or without payment therefor, as additional
compensation, or in lieu of other compensation, for their services to the
Company and/or any Affiliate.  Restricted Stock shall be subject to such
terms and conditions as the Committee determines appropriate, including,
without limitation, restrictions on sale or other disposition and rights
of the Company to reacquire such Restricted Stock upon termination of the
Participant's employment within specified periods, as prescribed by the
Committee.

(b)   Without limitation, such terms and conditions may provide
that Restricted Stock shall be subject to forfeiture if the Company or the
Participant fails to achieve certain goals established by the Committee
over a designated period of time.  Any grant of Restricted Stock subject
to such terms and conditions to a Section 16 Participant shall be in
writing.  The goals established by the Committee may relate to any one or
more of the following: revenues, earnings per share, return on shareholder
equity, return on average total capital employed, return on net assets
employed before interest and taxes, economic value added and/or, in the
case of Participants other than Section 16 Participants, such other goals
as may be established by the Committee in its discretion.  In the event
the minimum goal established by the Committee is not achieved at the
conclusion of a period, all Shares of Restricted Stock shall be forfeited. 
In the event the maximum goal is achieved, no Shares of Restricted Stock
shall be forfeited.  Partial achievement of the maximum goal may result in
forfeiture corresponding to the degree of nonachievement to the extent
specified in writing by the Committee when the grant is made.  The
Committee shall certify in writing as to the degree of achievement after
completion of the performance period.

11.  Bonus Shares; Deposit Share Program.  The Committee is
authorized to provide Participants the opportunity to elect to receive
Shares in lieu of a portion or all of cash bonuses under the Company's
incentive compensation programs and/or increases in base compensation
("Bonus Shares").  Bonus Shares shall be issued in an amount equal to (a)
the dollar amount of bonus or base compensation a Participant elects to
receive in Common Stock (subject to limits prescribed by the Committee)
divided by (b) the Fair Market Value of a Share (as determined on the date
the cash compensation to which the Bonus Shares relate would otherwise be
payable) and shall be subject to such terms and conditions as the
Committee deems appropriate, including, without limitation, restrictions
on withdrawal from the Deposit Share Program (as hereinafter defined),
sale or other disposition.

The Committee may establish a program (the "Deposit Share Program")
in connection with the delivery of Bonus Shares under which (a)
Participants wishing to receive Restricted Stock in tandem with Bonus
Shares shall deposit Bonus Shares with the Company or such other designee
of the Company and comply with all rules relating to the Deposit Share
Program as the Committee prescribes and (b) the Company shall match any
Bonus Shares a Participant has deposited with the Company by depositing up
to one (1) Share of Restricted Stock for each Bonus Share deposited, as
determined by the Committee.  The Restricted Stock deposited by the
Company shall vest in accordance with such terms and conditions as
determined by the Committee.

Elections to receive Bonus Shares or to participate in the Deposit
Share Program may be made only in accordance with such rules and
regulations prescribed by the Committee from time to time, including any
rules and regulations applicable to Section 16 Participants.

12.  Performance Shares.  The Committee may grant Performance that
the Participant may earn in whole or in part if the Company or the
Participant achieves certain goals established by the Committee over a
designated period of time consisting of one or more full fiscal years of
the Company, but not in any event more than five (5) years.  Any such
grant to a Section 16 Participant shall be in writing.  The goals
established by the Committee may relate to any one or more of the
following: revenues, earnings per share, return on shareholder equity,
return on average total capital employed, return on net assets employed
before interest and taxes, economic value added and/or, in the case of
Participants other than Section 16 Participants, such other goals as may
be established by the Committee in its discretion.  In the event the
minimum goal established by the Committee is not achieved at the
conclusion of a period, no delivery of Shares shall be made to the
Participant.  In the event the maximum goal is achieved, One Hundred
percent (100%) of the Performance Shares shall be delivered to the
Participant.  Partial achievement of the maximum goal may result in a
delivery corresponding to the degree of achievement to the extent
specified in writing by the Committee when the grant is made.  The
Committee shall certify in writing as to the degree of achievement after
completion of the performance period.  The Committee shall have the
discretion to satisfy an obligation to deliver a Participant's Performance
Shares by delivery of less than the number of Shares earned together with
a cash payment equal to the then Fair Market Value of the Shares not
delivered.  The number of Shares reserved for issuance under this Program
shall be reduced only by the number of Shares delivered in respect of
earned Performance Shares.  Subject to Section 18(c)(iii), at the time of
making an award of Performance Shares, the Committee shall set forth the
consequences of the termination of a Participant's employment with the
Company or an Affiliate prior to the expiration of the designated
performance period in respect of which the Performance Shares are
awarded.Shares to a Participant 

13.  Performance Units.  The Committee may grant Performance Units to
a Participant that consist of monetary units and that the Participant may
earn in whole or in part if the Company or the Participant achieves
certain goals established by the Committee over a designated period of
time consisting of one or more full fiscal years of the Company, but not
in any event more than five (5) years.  Any such grant to a Section 16
Participant shall be in writing.  The goals established by the Committee
may relate to any one or more of the following: revenues, earnings per
share, return on shareholder equity, return on average total capital
employed, return on net assets employed before interest and taxes,
economic value added, Share price and/or, in the case of Participants
other than Section 16 Participants, such other goals as may be established
by the Committee in its discretion.  In the event the minimum goal
established by the Committee is not achieved at the conclusion of a
period, no payment shall be made to the Participant.  In the event the
maximum goal is achieved, One Hundred percent (100%) of the monetary value
of the Performance Units shall be paid to the Participant.  Partial
achievement of the maximum goals may result in a payment corresponding to
the degree of achievement to the extent specified in writing by the
Committee when the grant is made.  The Committee shall certify in writing
as to the degree of achievement after completion of the performance
period.  Payment of a Performance Unit earned may be in cash or in Shares
or in a combination of both, as the Committee in its sole discretion
determines.  The number of Shares reserved for issuance under this Program
shall be reduced only by the number of Shares delivered in payment of
Performance Units.  Subject to Section 18(c)(iii), at the time of making
an award of Performance Units, the Committee shall set forth the
consequences of the termination of a Participant's employment with the
Company or an Affiliate prior to the expiration of the designated
performance period in respect of which the Performance Units are awarded.

14.  Non-Employee Directors.  Each Director who is not also an
employee of the Company (including members of the Committee) and who is a
Director on the date of the annual meeting of shareholders of the Company
during the term of the Program shall automatically be granted on each such
meeting date a non-qualified stock option for the purchase of 2,000 Shares
("Director Options") at a purchase price equal to One Hundred percent
(100%) of the Fair Market Value of the Shares on the date each Director
Option is granted, which shall be the closing price for the Common Stock
on such date as reported on the New York Stock Exchange.  Director Options
shall be exercisable for ten (10) years from the date of grant and shall
terminate six (6) months after the non-employee Director ceases to serve
as a Director for any reason other than death, except that, subject to the
maximum term of ten (10) years, (a) as to any Director who, at the time
the Director ceases to serve as a Director, is at least age 65 or has
completed six (6) years of service, the Director Options held by the
Director shall terminate three (3) years after the Director ceases to
serve as a Director and (b) the Committee may amend such time limits as to
any Director Options by action taken after the holder of the Director
Options ceases to be subject to the provisions of Section 16 of the
Exchange Act.  If the Director should die while serving as a Director, or
within any period after termination of his or her service as a Director
during which the Director Option was exercisable, then, subject to the
maximum term of ten (10) years, the right of his or her successor in
interest to exercise a Director Option shall terminate twelve (12) months
after the date of death.  Non-employee Directors shall not be eligible for
any Benefit under the Program.

15.  Transferability.  Each Award granted under this Program shall
not be transferable other than by will or the laws of descent and
distribution, except that a Participant or Director may, to the extent
allowed by the Committee and in a manner specified by the Committee,
(a) designate in writing a beneficiary to exercise the Award after the
Participant's or Director's death, as the case may be, and (b) transfer
any Award.

16.  Term of Program and Amendment, Modification or Cancellation of
Benefits.  

(a)  No Award shall be granted more than ten (10) years after
the Effective Date.

(b)  Except as provided in Section 19(a) below and subject to
the requirements of the Program, the Committee may modify or amend any
Award or waive any restrictions or conditions applicable to any Award or
the exercise thereof, and the terms and conditions applicable to any
Awards may at any time be amended, modified or canceled by mutual
agreement between the Committee and the Participant or Director or any
other persons as may then have an interest therein, so long as any
amendment or modification does not increase the number of Shares issuable
under this Program; provided, however, that no action may be taken under
this Section 16(b) with respect to Director Options if such action could
disqualify a non-employee Director from being a "disinterested person" for
purposes of Rule 16b-3.  Action may be taken under this Section 16(b)
notwithstanding expiration of the Program under Section 16(a).

17.  Taxes.  The Company shall be entitled to withhold the amount of
any tax attributable to any amount payable or Shares deliverable under the
Program after giving the person entitled to receive such amount or Shares
notice as far in advance as practicable, and the Company may defer making
payment or delivery if any such tax may be pending unless and until
indemnified to its satisfaction.  The Committee may, in its discretion and
subject to such rules as it may adopt, permit a Participant to pay all or
a portion of the federal, state and local withholding taxes arising in
connection with (a) the exercise of a Non-Qualified Stock Option, (b) a
disqualifying disposition of Common Stock received upon the exercise of an
Incentive Stock Option, (c) the lapse of restrictions on Restricted Stock
or (d) the receipt of Performance Shares, by electing to (i) have the
Company withhold Shares, (ii) tender back Shares received in connection
with such Benefit or (iii) deliver other previously owned Shares, having a
Fair Market Value equal to the amount to be withheld; provided, however,
that the amount to be withheld shall not exceed the Participant's
estimated total federal, state and local tax obligations associated with
the transaction.  The election must be made on or before the date as of
which the amount of tax to be withheld is determined and otherwise as
required by the Committee. The Fair Market Value of fractional Shares
remaining after payment of the withholding taxes shall be paid to the
Participant in cash.  

The Committee may, in its discretion, grant a cash bonus to a
Participant who holds Restricted Stock, either inside or outside of the
Deposit Share Program, or Performance Shares to enable the Participant to
pay all or a portion of the federal, state or local tax liability incurred
by the Participant upon the vesting of Restricted Stock or Performance
Shares.  The Company shall deduct from any cash bonus such amount as may
be required for the purpose of satisfying the Company's obligation to
withhold federal, state or local taxes.

18.  Adjustment Provisions; Change of Control.

(a)  If the Company shall at any time change the number of
issued Shares without new consideration to the Company (such as by stock
dividends or stock splits), the total number of Shares reserved for
issuance under this Program and the number of Shares covered by each
outstanding Award shall be adjusted so that the aggregate consideration
payable to the Company and the value of each such Award shall not be
changed.  The Committee shall also have the right to provide for the
continuation of Awards or for other equitable adjustments after changes in
the Common Stock resulting from reorganization, sale, merger,
consolidation or similar occurrence; provided, however, that Director
Options subject to grant or previously granted to Directors under the
Program at the time of any such event shall be subject to only such
adjustment as shall be necessary to maintain the proportionate interest of
the Director and preserve, without exceeding, the value of such Director
Options.

(b)  Notwithstanding any other provision of this Program, and
without affecting the number of Shares otherwise reserved or available
hereunder, the Committee may authorize the issuance or assumption of
Benefits in connection with any merger, consolidation, acquisition of
property or stock, or reorganization upon such terms and conditions as it
may deem appropriate.

(c)  In the event of a "change of control" (as hereinafter
defined):

(i)  each holder of an Option and Director Option (A) shall
have the right at any time thereafter to exercise the Option or
Director Option in full whether or not the Option or Director
Option was theretofore exercisable; and (B) shall have the
right, exercisable by written notice to the Company within 60
days after the change of control, to receive, in exchange for
the surrender of the Option or Director Option or any portion
thereof to the extent the Option or Director Option is then
exercisable in accordance with clause (A), the highest of (1) an
amount of cash equal to the difference between the Fair Market
Value of the Common Stock covered by the Option or Director
Option or portion thereof that is so surrendered  on the date of
the change of control and the purchase price of such Common
Stock under the Option or Director Option, (2) an amount of cash
equal to the difference between the highest price per Share of
Common Stock paid in the transaction giving rise to the change
of control and the purchase price per Share of Common Stock
under the Option or Director Option multiplied by the number of
Shares of Common Stock covered by the Option or Director Option
or (3) an amount of cash equal to the difference between the
Fair Market Value of the Common Stock covered by the Option or
Director Option or portion thereof that is so surrendered,
calculated on the date of surrender, and the purchase price of
such Common Stock under the Option or Director Option; provided
that the right described in this clause (B) shall be exercisable
only if a positive amount would be payable to the holder
pursuant to the formula specified in this clause (B);

(ii) Restricted Stock held inside or outside of the Deposit
Share Program (including Bonus Shares) that is not then vested
shall vest upon the date of the change of control and each
holder of such Restricted Stock shall have the right,
exercisable by written notice to the Company within sixty (60)
days after the change of control, to receive, in exchange for
the surrender of such Restricted Stock, an amount of cash equal
to the highest of (A) the Fair Market Value of such Restricted
Stock on the date of surrender, (B) the highest price per Share
of Common Stock paid in the transaction giving rise to the
change of control multiplied by the number of Shares of
Restricted Stock surrendered or (C) the Fair Market Value of
such Restricted Stock on the effective date of the change of
control;

(iii)  each holder of a Performance Share and/or
Performance Unit for which the performance period has not
expired shall have the right, exercisable by written notice to
the Company within 60 days after the change of control, to
receive, in exchange for the surrender of the Performance Share
and/or Performance Unit, an amount of cash equal to the product
of the value of the Performance Share and/or Performance Unit
and a fraction the numerator of which is the number of whole
months which have elapsed from the beginning of the performance
period to the date of the change of control and the denominator
of which is the number of whole months in the performance
period; and

(iv) each holder of a Performance Share and/or Performance
Unit that has been earned but not yet paid shall receive an
amount of cash equal to the value of the Performance Share
and/or Performance Unit.

For purposes of this Section 18, the "value" of a Performance Share
shall be equal to the highest of (1) the Fair Market Value of a Share of
Common Stock on the date of the change of control, (2) the highest price
per Share of Common Stock paid in the transaction giving rise to the
change of control or (3) the Fair Market Value of a Share of Common Stock
calculated on the date of surrender or payment, as the case may be.

(d)  A "change of control" of the Company shall be deemed to
have occurred for purposes of this Section 18 if the event set forth in
any one of the following paragraphs shall have occurred:

(i)  any "Person" (as such term is defined in Section
3(a)(9) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as modified and used in Sections 13(d) and
14(d) thereof, except that for purposes of this Section 18, the
term "Person" shall not include (1) the Company or any of its
subsidiaries, (2) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or any
of its subsidiaries, (3) an underwriter temporarily holding
securities pursuant to an offering of such securities, or (4) a
corporation owned, directly or indirectly, by the shareholders
of the Company in substantially the same proportions as their
ownership of stock in the Company) is or becomes the "Beneficial
Owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company (not
including in the securities beneficially owned by such Person
any securities acquired directly from the Company or its
affiliates) representing 25% or more of either the then
outstanding Shares of common stock of the Company or the
combined voting power of the Company's then outstanding voting
securities; or

(ii) the following individuals cease for any reason to
constitute a majority of the number of Directors then serving: 
individuals who, on January 1, 1996, constitute the Board and
any new Director (other than a Director whose initial assumption
of office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation,
relating to the election of Directors of the Company, as such
terms are used in Rule 14a-11 of Regulation 14A under the
Exchange Act) whose appointment or election by the Board or
nomination for election by the Company's shareholders was
approved by a vote of at least two-thirds (2/3) of the Directors
then still in office who either were Directors on January 1,
1996 or whose appointment, election or nomination for election
was previously so approved; or

(iii)   the shareholders of the Company approve a merger
or consolidation of the Company with any other corporation or
approve the issuance of voting securities of the Company in
connection with a merger or consolidation of the Company (or any
direct or indirect subsidiary of the Company) pursuant to
applicable stock exchange requirements, other than (1) a merger
or consolidation which would result in the voting securities of
the Company outstanding immediately prior to such merger or
consolidation continuing to represent (either by remaining out-
standing or by being converted into voting securities of the
surviving entity or any parent thereof) at least 60% of the
combined voting power of the voting securities of the Company or
such surviving entity or any parent thereof outstanding
immediately after such merger or consolidation, or (2) a merger
or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no Person is or
becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired
directly from the Company or its affiliates) representing 25% or
more of either the then outstanding Shares of common stock of
the Company or the combined voting power of the Company's then
outstanding voting securities; or

(iv) the shareholders of the Company approve a plan of
complete liquidation or dissolution of the Company or an
agreement for the sale or disposition by the Company of all or
substantially all of the Company's assets (in one transaction or
a series of related transactions within any period of 24
consecutive months), other than a sale or disposition by the
Company of all or substantially all of the Company's assets to
an entity, at least 75% of the combined voting power of the
voting securities of which are owned by Persons in substantially
the same proportions as their ownership of the Company immedi-
ately prior to such sale.

Notwithstanding the foregoing, no "Change of Control" shall be deemed to
have occurred if there is consummated any transaction or series of
integrated transactions immediately following which the record holders of
the common stock of the Company immediately prior to such transaction or
series of transactions continue to have substantially the same propor-
tionate ownership in an entity which owns all or substantially all of the
assets of the Company immediately following such transaction or series of
transactions. 

(e)  As of the Effective Date, any outstanding Benefit
previously granted under the Program shall be deemed amended to provide to
the holder of such Benefit rights corresponding to those described in
paragraph (c) of this Section 18 in the event of a change of control (as
defined herein).

(f)  The Committee may, in its sole and absolute discretion,
amend, modify or rescind the provisions of this Section 18 if it
determines that the operation of this Section 18 may prevent a transaction
in which the Company or any Affiliate is a party from being accounted for
on a pooling-of-interests basis.

19.  Amendment and Termination of the Program; Correction of Defects
and Omissions.

(a)  The Board may at any time amend, alter, suspend,
discontinue or terminate the Program; provided, however, that the
provisions of Section 14 of the Program shall not be amended more than
once every six (6) months, other than to comport with changes in the Code,
the Employee Retirement Income Security Act of 1974, as amended, or the
rules promulgated thereunder; and provided further that shareholder
approval of any amendment of the Program shall also be obtained if
otherwise required by (i) the rules and/or regulations promulgated under
Section 16 of the Exchange Act (in order for the Program to remain
qualified under Rule 16b-3), (ii) the Code or any rules promulgated
thereunder (in order to allow for Incentive Stock Options to be granted
under the Program or to enable the Company to comply with the provisions
of Section 162(m) of the Code so that the Company can deduct compensation
in excess of the limitation set forth therein), or (iii) the listing
requirements of the New York Stock Exchange or any principal securities
exchange or market on which the Shares are then traded (in order to
maintain the listing or quotation of the Shares thereon).  Termination of
the Program shall not affect the rights of Participants or Directors with
respect to Awards previously granted to them, and all unexpired Awards
shall continue in force and effect after termination of the Program except
as they may lapse or be terminated by their own terms and conditions.

(b)  The Committee may correct any defect, supply any omission,
or reconcile any inconsistency in any Award or agreement covering an Award
in the manner and to the extent it shall deem desirable to carry the
Program into effect.

20.  Miscellaneous.  The grant of any Award under the Program may
also be subject to other provisions (whether or not applicable to the
Benefit awarded to any other Participant) as the Committee determines
appropriate, including, without limitation, provisions for (a) one or more
means to enable Participants or Directors to defer recognition of taxable
income relating to Awards or cash payments derived therefrom, which means
may provide for a return to a Participant or Director on amounts deferred
as determined by the Committee (provided that no such deferral means may
result in an increase in the number of Shares issuable hereunder); (b) the
purchase of Common Stock under Options or Director Options in
installments; (c) the financing of the purchase of Common Stock under
Options or Director Options in the form of a promissory note issued to the
Company by a Participant or Director on such terms and conditions as the
Committee determines; (d) the payment of the purchase price of Options or
Director Options (i) by delivery of cash or other Shares or securities of
the Company having a then Fair Market Value equal to the purchase price of
such Shares or (ii) by delivery (including by fax) to the Company or its
designated agent of an executed irrevocable option exercise form together
with irrevocable instructions to a broker-dealer to sell or margin a
sufficient portion of the Shares and deliver the sale or margin loan
proceeds directly to the Company to pay for the exercise price; (e)
restrictions on resale or other disposition; and (f) compliance with
federal or state securities laws and stock exchange requirements. 
Notwithstanding the foregoing, to the extent required by Rule 16b-3,
Director Options shall be automatic, and the amount and terms of such
Director Options shall be determined as provided in Section 14 of the
Plan.
*****

Amended and Restated
Snap-on Incorporated
Directors' 1993 Fee Plan
(as amended January 26, 1996)

1.   Purpose.  The Amended and Restated Snap-on Incorporated
Directors' 1993 Fee Plan (the "Plan") is intended to provide an incentive
to members of the Board of Directors (the "Board") of Snap-on
Incorporated, a Delaware corporation (the "Company"), who are not
employees of the Company ("Directors"), to remain in the service of the
Company and increase their efforts for the success of the Company and to
encourage such Directors to own shares of the Company's stock or
participate in a Company phantom stock account, thereby aligning their
interests more closely with the interests of stockholders.

2.   Definitions.

(a)  "Board" means the Board of Directors of the Company.

(b)  "Committee" means a committee consisting of members of the
Board authorized to administer the Plan.

(c)  "Common Stock" means the common stock, par value $1.00 per
share, of the Company.

(d)  "Deferral Election" means an election pursuant to Section 6
hereof to defer receipt of Fees and/or shares of Common Stock which would
otherwise be received pursuant to Minimum Grants and Elective Grants.

(e)  "Deferred Amounts" mean the amounts credited to a
Director's Share Account or Cash Account pursuant to a Deferral Election.

(f)  "Director" means a member of the Board who is not an
employee of the Company.

(g)  "Elective Grants" shall have the meaning set forth in
Section 5(b) hereof.

(h)  "Exchange Act" means the Securities Exchange Act of 1934,
as amended.

(i)  "Fair Market Value" means the closing price of the Common
Stock on the New York Stock Exchange on any particular date.

(j)  "Fees" mean the annual retainer scheduled to be paid to a
Director for the calendar year plus any additional fees (including meeting
and committee fees) earned by a Director for his services on the Board
during the calendar year.

(k)  "Grants" mean Minimum Grants and Elective Grants.

(l)  "Minimum Grants" shall have the meaning set forth in
Section 5(a) hereof.

(m)  "Share Election" shall have the meaning set forth in
Section 5(b) hereof.

3.   Administration of the Plan.

(a)  Member of the Committee.  The Plan shall be administered by
the Committee.  Members of the Committee shall be appointed from time to
time by the Board, shall serve at the pleasure of the Board and may resign
at any time upon written notice to the Board.

(b)  Authority of the Committee.  The Committee shall adopt such
rules as it may deem appropriate in order to carry out the purpose of the
Plan.  All questions of interpretation, administration, and application of
the Plan shall be determined by a majority of the members of the Committee
then in office, except that the Committee may authorize any one or more of
its members, or any officer of the Company, to execute and deliver
documents on behalf of the Committee.  The determination of such majority
shall be final and binding in all matters relating to the Plan.  No member
of the Committee shall be liable for any act done or omitted to be done by
such member or by any other member of the Committee in connection with the
Plan, except for such member's own willful misconduct or as expressly
provided by statute.

4.   Stock Reserved for the Plan.  The number of shares of Common
Stock authorized for issuance under the Plan is 200,000, subject to
adjustment pursuant to Section 7 hereof.  Shares of Common Stock delivered
hereunder may be either authorized but unissued shares or previously
issued shares reacquired and held by the Company.

5.   Terms and Conditions of Grants.

(a)  Minimum Grant.  Subject to Section 5(e) hereof, each
Director shall automatically receive (subject to a Deferral Election) a
number of whole shares of Common Stock equal in value to twenty five
percent (25%) of his or her Fees earned in each calendar year (the
"Minimum Grants").  Such shares of Common Stock (and cash in lieu of
fractional shares) shall be transferred in accordance with Section 5(c)
hereof.

(b)  Elective Grant.  Subject to Section 5(e) hereof, each
Director may make an annual election (the "Share Election") to receive
(subject to a Deferral Election) any or all of his or her remaining Fees
earned in each calendar year in the form of Common Stock (the "Elective
Grants").  The shares of Common Stock (and cash in lieu of fractional
shares) issuable pursuant to a Share Election shall be transferred in
accordance with Section 5(c) hereof.  The Share Election must be in
writing and delivered to the Secretary of the Company on or prior to
December 31 of the calendar year immediately preceding the calendar year
in which the applicable Fees are to be earned; provided, however, that any
Director who commences his or her directorship subsequent to January 1 of
a calendar year (a "New Director") may make a Share Election during the
thirty-day period immediately following the commencement of his or her
directorship; and provided further, however, that a Share Election shall
only apply with respect to Fees to be paid more than six months subsequent
to the date of such Share Election.  A Share Election, once made, shall be
irrevocable for the calendar year with respect to which it is made and
shall remain in effect for future calendar years unless modified or
revoked by a subsequent Share Election in accordance with the provisions
hereof.

(c)  Transfer of Shares.  Shares of Common Stock issuable to a
Director with respect to Minimum Grants and Elective Grants shall be
transferred to such Director as of the last business day of each calendar
month.  The total number of shares of Common Stock to be so transferred
(1) in respect of a Minimum Grant, shall be determined by dividing (a) an
amount equal to 25% of the Director's Fees payable during the applicable
calendar month, by (b) the Fair Market Value of a share of Common Stock on
the last business day of such calendar month, and (2) in respect of an
Elective Grant, shall be determined by dividing (x) the dollar amount of
the Director's Fees payable during the applicable calendar month to which
the Share Election applies, by (y) the Fair Market Value of a share of
Common Stock on the last business day of such calendar month.  In no
event, shall the Company be required to issue fractional shares.  Whenever
under the terms of this Section 5 a fractional share of Common Stock would
otherwise be required to be issued to a Director, an amount in lieu
thereof shall be paid in cash based upon the Fair Market Value of such
fractional share.

(d)  Termination of Services.  If a Director's services as a
Board member are terminated before the end of a calendar quarter, the
Director shall receive in cash the Fees such Director would otherwise have
been entitled to receive for such quarter in the absence of this Plan.

(e)  Commencement of Grants.  Notwithstanding anything in this
Plan to the contrary, no Grants shall be effective with respect to Fees to
be paid prior to the requisite approval of this Plan by the stockholders
of the Company.

6.   Deferral Election.

(a)  In General.  Each Director may irrevocably elect annually
(a "Deferral Election") to defer receiving all or a portion of the shares
of Common Stock (that would otherwise be transferred upon a Grant) or such
Director's Fees in respect of a calendar year that are not subject to a
Grant.  Deferral Elections shall be made in multiples of ten percent.  A
Director who makes a Deferral Election with respect to Grants shall have
the amount of deferred shares of Common Stock credited to a "Share
Account" in the form of "Share Units."  A Director who makes a Deferral
Election with respect to Fees that are not subject to a Grant shall have
the amount of Deferred Fees credited to a "Cash Account."  Collectively,
the amounts deferred in a Director's Share Account and Cash Account shall
hereafter be the "Deferred Amounts."

(b)  Timing of Deferral Election.  The Deferral Election shall
be in writing and delivered to the Secretary of the Company on or prior to
December 31 of the calendar year immediately preceding the calendar year
in which the applicable Fees are to be earned; provided, however, that a
New Director may make a Deferral Election with respect to Fees earned
subsequent to such election during the thirty-day period immediately
following the commencement of his or her directorship.  A Deferral
Election, once made, shall be irrevocable for the calendar year with
respect to which it is made and shall remain in effect for future calendar
years unless modified or revoked by a subsequent Deferral Election in
accordance with the provisions hereof.  A Deferral Election may be changed
only with respect to fees earned subsequent to the effective date of such
Election.

(c)  Cash Dividends and Share Accounts.  Whenever cash dividends
are paid by the Company on outstanding Common Stock, there shall be
credited to the Director's Share Account additional Share Units equal to
(i) the aggregate dividend that would be payable on outstanding Shares of
Common Stock equal to the number of Share Units in such Share Account on
the record date for the dividend, divided by (ii) the Fair Market Value of
the Common Stock on the last trading business day immediately preceding
the date of payment of the dividend.

(d)  Cash Accounts.  At the election of a Director, a Director's
Cash Account shall be credited or debited with (i) interest at an annual
rate equal to the sum of the daily interest earned at a rate specified by
the Committee and compounded monthly or (ii) the annual investment return
relating to such investment vehicle or vehicles that the Director chooses
from those the Committee determines to make available, or such combination
of (i) and (ii) as the Director designates at the time of a Deferral
Election or a modification thereof.

(e)  Commencement of Payments.  Except as otherwise provided in
Sections 6(g) and 8(b), a Director's Deferred Amounts shall become payable
as soon as practicable following the earlier to occur of (a) the date the
Director terminates service as a Director or (b) the Director's attainment
of age 70 years or such later date (not later than the Director's 75th
birthday) designated by the Director in the Deferral Election.  

(f)  Form of Payments.  All payments from a Share Account shall
be made in shares of Common Stock by converting Share Units into Common
Stock on a one-for-one basis, with payment of fractional shares to be made
in cash.  All payments from a Cash Account shall be made in cash.

(g)  Manner of Payments.  In his or her Deferral Election, each
Director shall elect to receive payment of his or her Deferred Amounts
either in a lump sum or in two to fifteen substantially equal annual
installments.  In the event of a Director's death, payment of the
remaining portion of the Director's Deferred Amounts will be made to the
Director's beneficiary in a lump sum as soon as practicable following the
Director's death.

(h)  Hardship Distribution.  Notwithstanding any Deferral
Election, in the event of severe financial hardship to a Director
resulting from a sudden and unexpected illness, accident or disability of
the Director or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the
director, all as determined by the Committee, a Director may withdraw any
portion of the Share Units in his or her Share Account or cash in his or
her Cash Account by providing written notice to the Secretary of the
Company.  All payments resulting from such a hardship shall be made in the
form provided in Section 6(f) above.

(i)  Designation of Beneficiary.  Each Director or former
Director entitled to payment of deferred amounts hereunder from time to
time may designate any beneficiary or beneficiaries (who may be designated
concurrently, contingently or successively) to whom any such deferred
amounts are to be paid in case of the Director's death before receipt of
any or all of such deferred amounts.  Each designation will revoke all
prior designations by the Director or former Director, shall be in a form
prescribed by the Company, and will be effective only when filed by the
Director or former Director, during his or her lifetime, in writing with
the Secretary of the Company.  Reference in this Plan to a Director's
"beneficiary" at any date shall include such persons designated as
concurrent beneficiaries on the Director's beneficiary designation form
then in effect.  In the absence of any such designation, any balance
remaining in a Director's or former Director's Share Account at the time
of the Director's death shall be paid to such Director's estate in a lump
sum.

(j)  No Account Transfers.  A Director may not transfer or
convert a Share Account to a Cash Account or vice versa.

7.   Effect of Certain Changes in Capitalization.  If there is any
change in the number or class of shares of Common Stock through the
declaration of stock dividends, or recapitalization resulting in stock
splits, or combinations or exchanges of such shares or similar corporate
transactions, the maximum number or class of shares available under the
Plan, the number or class of shares of Common Stock to be delivered
hereunder and each Director's Share Account shall be proportionately
adjusted by the Committee to reflect any such change in the number or
class of issued shares of Common Stock; provided, however, that the number
or class of shares of Common Stock to be delivered and each Director's
Share Account shall be subject to only such adjustment as shall be
necessary to maintain the proportionate interest of the Director and
preserve, without exceeding, the value reflected by the Director's Share
Account.

8.   Change of Control.  A "Change of Control" of the Company shall
be deemed to have occurred if:

(1)  any "Person" (as such term is defined in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), as modified and used in Sections 13(d) and 14(d) thereof,
except that for purposes of this Section 8, the term "Person"
shall not include (A) the Company or any of its subsidiaries,
(B) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its subsidiaries,
(C) an underwriter temporarily holding securities pursuant to an
offering of such securities, or (D) a corporation owned,
directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock
in the Company) is or becomes the "Beneficial Owner"(as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly,
of securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired
directly from the Company or its affiliates) representing 25% or
more of either the then outstanding shares of common stock of
the Company or the combined voting power of the Company's then
outstanding voting securities; or

(2)  the following individuals cease for any reason to constitute a
majority of the number of directors then serving:  individuals
who, on January 1,1996, constitute the Board and any new
director (other than a director whose initial assumption of
office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation,
relating to the election of directors of the Company, as such
terms are used in Rule 14a-11 of Regulation 14A under the
Exchange Act) whose appointment or election by the Board or
nomination for election by the Company's stockholders was
approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors on January 1,
1996 or whose appointment, election or nomination for election
was previously so approved; or

(3)  the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation or
approve the issuance of voting securities of the Company in
connection with a merger or consolidation of the Company (or any
direct or indirect subsidiary of the Company) pursuant to
applicable stock exchange requirements, other than (1) a merger
or consolidation which would result in the voting securities of
the Company outstanding immediately prior to such merger or
consolidation continuing to represent (either by remaining out-
standing or by being converted into voting securities of the
surviving entity or any parent thereof) at least 60% of the
combined voting power of the voting securities of the Company or
such surviving entity or any parent thereof outstanding
immediately after such merger or consolidation, or (2) a merger
or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no Person is or
becomes the Beneficial Owner, directly or indirectly, of
securities of the Company not including in the securities
beneficially owned by such Person any securities acquired
directly from the Company or its affiliates) representing 25% or
more of either the then outstanding shares of common stock of
the Company or the combined voting power of the Company's then
outstanding voting securities; or

(4)  the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company or an agreement for
the sale or disposition by the Company of all or substantially
all of the Company's assets (in one transaction or a series of
related transactions within any period of 24 consecutive
months), other than a sale or disposition by the Company of all
or substantially all of the Company's assets to an entity, at
least 75% of the combined voting power of the voting securities
of which are owned by Persons in substantially the same pro-
portions as their ownership of the Company immediately prior to
such sale.  

Notwithstanding the foregoing, no "Change of Control" shall be deemed
to have occurred if there is consummated any transaction or series of
integrated transactions immediately following which the record
holders of the common stock of the Company immediately prior to such
transaction or series of transactions continue to have substantially
the same proportionate ownership in an entity which owns all or
substantially all of the assets of the Company immediately following
such transaction or series of transactions.

(b)  Upon the occurrence of a Change of Control:

(i)  all Share Units credited to a Share Account shall be
converted into Common Stock and together with all Deferred Amounts
credited to a Cash Account shall be transferred as soon as practicable to
each Director; and

(ii) Notwithstanding anything herein to the contrary, Fees
earned in respect of the calendar quarter in which the Change of Control
occurs, shall be paid in cash as soon as practicable.

9.   Term of Plan.  This Plan shall become effective as of the date
of approval of the Plan by the stockholders of the Company, and shall
remain in effect until a Change of Control, unless sooner terminated by
the Board; provided, however, that, except as provided in Section 8(b)
hereof, Deferred Amounts may be delivered pursuant to any Deferral
Election, in accordance with such election, after the Plan's termination. 
Prior to the effective date of the Plan, Directors may make the elections
provided for herein, but the effectiveness of such elections shall be
contingent upon the receipt of stockholder approval of the Plan.  No
transfer of shares of Common Stock may be made to any Director or any
other person under the Plan until such time as stockholder approval of the
Plan is obtained pursuant to this Section 9.  In the event stockholder
approval is not obtained, Fees that were not subject to Deferral Elections
shall be paid to the Directors in cash and Fees that were subject to
Deferral Elections shall be deferred pursuant to the Prior Plan.

10.  Amendment; Termination.  The Board may at any time and from time
to time alter, amend, suspend, or terminate the Plan in whole or in part;
provided, however, that no amendment which requires stockholder approval
in order for the exemptions available under Rule 16b-3 of the Exchange
Act, as amended from time to time ("Rule 16b-3"), to be applicable to the
Plan and the Directors shall be effective unless the same shall be
approved by the stockholders of the Company entitled to vote thereon; and,
provided further, that the provisions of Section 5(a) hereof shall not be
amended more than once every six months, other than to comport with
changes in the Internal Revenue Code of 1986, as amended, the Employee
Retirement Income Security Act of 1974, as amended, or the rules
thereunder.  Notwithstanding the foregoing, no amendment shall affect
adversely any of the rights of any Director (including without limitation
the rights a Director would have under Section 8 if a Change of Control
were to occur), without such Director's consent, under any election
theretofore in effect under the Plan.

11.  Rights of Directors.

(a)  Retention as Director.  Nothing contained in the Plan or
with respect to any Grant shall interfere with or limit in any way the
right of the stockholders of the Company to remove any Director from the
Board pursuant to the bylaws of the Company, nor confer upon any Director
any right to continue in the service of the Company as a Director.

(b)  Nontransferability.  No right or interest of any Director
in Deferred Amounts shall be assignable or transferable during the
lifetime of the Director, either voluntarily or involuntarily, or
subjected to any lien, directly or indirectly, by operation of law, or
otherwise, including execution, levy, garnishment, attachment, pledge or
bankruptcy.  In the event of a Director's death, a Director's rights and
interests in his or her Deferred Amounts shall be transferable by
testamentary will or the laws of descent and distribution.  If in the
opinion of the Committee a person entitled to payments or to exercise
rights with respect to the Plan is disabled from caring for his or her
affairs because of mental condition, physical condition or age, payment
due such person may be made to, and such rights shall be exercised by,
such person's guardian, conservator or other legal personal representative
upon furnishing the Committee with evidence satisfactory to the Committee
of such status.

12.  General Restrictions.

(a)  Investment Representations.  The Company may require any
director to whom Common Stock is granted, as a condition of receiving such
Common Stock, to give written assurances in substance and form
satisfactory to the Company and its counsel to the effect that such person
is acquiring the Common Stock for his own account for investment and not
with any present intention of selling or otherwise distributing the same,
and to such other effects as the Company deems necessary or appropriate in
order to comply with Federal and applicable state securities laws.

(b)  Compliance with Securities Laws.  Each Grant shall be
subject to the requirement that, if at any time counsel to the Company
shall determine that the listing, registration or qualification of the
shares subject to such Grant upon any securities exchange or under any
state or federal law, or the consent or approval of any governmental or
regulatory body, is necessary as a condition of, or in connection with,
the issuance of shares thereunder, such Grant may not be accepted or
exercised in whole or in part unless such listing, registration,
qualification, consent or approval shall have been effected or obtained on
conditions acceptable to the Committee.  Nothing herein shall be deemed to
require the Company to apply for or to obtain such listing, registration
or qualification.

13.  Withholding.  The Company may defer making payments under the
Plan until satisfactory arrangements have been made for the payment of any
federal, state or local income taxes required to be withheld with respect
to such payment or delivery.  Each Director shall be entitled to
irrevocably elect, at least six months prior to the date shares of Common
Stock would otherwise be delivered hereunder, to have the Company withhold
shares of Common Stock having an aggregate value equal to the amount
required to be withheld.  The value of fractional shares remaining after
payment of the withholding taxes shall be paid to the Director in cash. 
Shares so withheld shall be valued at Fair Market Value on the regular
business day immediately preceding the date such shares would otherwise be
transferred hereunder.

14.  Governing Law.  This Plan and all rights hereunder shall be
construed in accordance with and governed by the laws of the State of
Delaware.

15.  Plan Interpretation.  The Plan is intended to comply with Rule
16b-3 and shall be construed to so comply.  To the extent Rule 16b-3, as
amended by SEC Release 34-28869 (and as amended from time to time), is
applicable to the Plan, the provisions of Section 5(a) hereof are intended
to comply with the provisions of Section (c)(2)(ii) of Rule 16b-3, and the
provisions of Section 5(b) hereof are intended to comply with the
provisions of Section (d)(1)(i) of Rule 16b-3; and each such Section shall
be construed to so comply.

16.  Headings.  The headings of sections and subsections herein are
included solely for convenience of reference and shall not affect the
meaning of any of the provisions of the Plan.

SNAP-ON INCORPORATED
DEFERRED COMPENSATION PLAN
(as amended through January 26, 1996)

Section 1.  Establishment and Purposes

1.1  Establishment.  Snap-on Incorporated hereby establishes, effective as
of April 1, 1986, a deferred compensation plan for executives as described
herein, which shall be known as the "SNAP-ON INCORPORATED DEFERRED
COMPENSATION PLAN" (hereinafter called the "Plan").

1.2  Purposes.  The purposes of this Plan are to enable the Corporation to
attract and retain persons of outstanding competence, to provide a means
whereby certain amounts payable by the Corporation to selected executives
may be deferred to some future period and to provide such executives with
a means to have deferred amounts treated as if invested in the
Corporation's stock, thereby aligning their interests more closely with
the interests of shareholders.  The plan is intended to constitute an
unfunded plan primarily for the purpose of providing deferred compensation
for a select group of management or highly compensated employees.

Section 2.  Definitions

2.1  Definitions.  Whenever used herein, the following terms shall have
the meanings set forth below:

(a)  "Board" means the Board of Directors of the Corporation.

(b)  "Committee" means the Organization and Compensation Committee of the
Board.

(c)  "Common Stock" means the common stock, par value $1.00 per share, of
the Corporation.

(d)  "Compensation" means the gross Salary and Incentive Compensation
payable to a Participant during a Year.

(i)  Salary.  "Salary" means all regular, basic compensation, before
reduction for amounts deferred pursuant to this Plan or any
other plan of the Corporation, payable in cash to a Participant
for services during the Year, exclusive of any bonuses or
incentive compensation, special fees or awards, allowances, or
amounts designated by the Corporation as payments toward or
reimbursement of expenses.

(ii) Incentive Compensation.  "Incentive Compensation" means the
annual Incentive Compensation Plan payable in cash by the
Corporation to a Participant in a Year.

(e)  "Corporation" means Snap-on Incorporated, a Delaware corporation.

(f)  "Fair Market Value" means the closing price of the Common Stock on
the New York Stock Exchange on any particular date; provided,
however, that for purposes of Section 16, Fair Market Value shall
mean the closing price of the Common Stock on the New York Stock
Exchange on the date of the Change of Control (as defined therein)
or, if higher, the highest price per share of Common Stock paid in
the transaction giving rise to the Change of Control.

(g)  "Growth Increment" means the amount of interest earned on a
Participant's deferred amounts.

(h)  "Participant" means an individual selected by the Committee for
participation in the Plan.

(i)  "Year" means a calendar year.

2.2  Gender and Number.  Except when otherwise indicated by the context,
any masculine terminology used herein also shall include the feminine
gender, and the definition of any term herein in the singular also shall
include the plural.

Section 3.  Eligibility and Participation

3.1  Eligibility.  The elected officers and appointed officers of the
Corporation shall be eligible to participate in this Plan.

3.2  Ceasing Eligibility.  In the event a Participant no longer meets the
requirements for participation in this Plan, he shall become an inactive
Participant, retaining all the rights described under this Plan, except
the right to make any further deferrals, until the time that he again
meets the eligibility requirements of Section 3.1.

Section 4.  Election to Defer

4.1  Deferral Election.  Subject to the following provisions, prior to the
beginning of the Year, a Participant irrevocably may elect, by written
notice to the Corporation, to defer all or a percentage of annual Salary,
Incentive Compensation, or both Salary and Incentive Compensation.  The
amount to be deferred each year must equal or exceed $5,000.

(a)  With respect to Salary deferrals, the deferral percentage elected
shall be applied to the Participant's Salary for each pay period of
the Year to which the Deferral Election applies and must be made
before November 30 of the year immediately preceding the Year for
which such Deferral Election applies.

(b)  With respect to Incentive Compensation deferrals, the deferral
percentage elected shall apply only to the Participant's Incentive
Compensation payable with respect to service to be performed in the
Year and must be made before December 31 of such Year.

An individual who becomes a Participant at or after the beginning of
the Year may irrevocably elect, by written notice to the Corporation, to
defer all or a percentage of (i) the annual Salary earned by such
Participant for such Year after such election, if such election is made
within 30 days after becoming a Participant, and (ii) the pro rata share
of the Participant's Incentive Compensation, if any, payable with respect
to service performed during such Year, if such election is made before
December 31 of such Year.

4.2  Deferral Period.  The Participant irrevocably shall select the
deferral period for each separate deferral.  The deferral period shall be
for a specified number of years or until a specified date.  The deferral
period shall not be less than five years.  However, notwithstanding the
deferral period specified, payments shall begin following the earliest to
occur of:

(a)  Death,

(b)  Total and permanent disability,

(c)  Retirement, or

(d)  Termination of employment.

4.3  Manner of Payment Election.  At the same time as the election made
pursuant to Section 4.1, the Participant also may elect to have a deferred
amount paid either in a lump sum or in a specified number of approximately
equal annual installments, not to exceed ten.  The Participant who has
made such an election as to manner of payment may change the manner in
which the deferred amount will be paid and/or the date such payments are
to commence by written election made prior to the Year in which such
payments are to commence. 

Section 5.  Deferred Compensation Account

5.1  Participant Accounts.  The Corporation shall establish and maintain
individual bookkeeping accounts in respect of deferrals made by a
Participant consisting of a "Cash Account" and a "Share Account."  A
Participant shall have separate Cash Accounts and Share Accounts for
deferred amounts with different deferral periods under Section 4.2 hereof
and/or manners of payment under Section 4.3 hereof.  A Participant's Cash
Account shall be credited with the dollar amount of any amount deferred as
of the date the amount deferred otherwise would have become due and
payable. 

5.2  Growth Increments.  The Corporation will provide the opportunity for
Growth Increments to be earned on the balance of a Participant's Cash
Accounts.  The Committee will have the authority to select, from time to
time, the appropriate interest rate to apply to such amounts.  Each Cash
Account shall be credited on the first day of each month with a Growth
Increment computed on the daily balance in the Cash Account during the
immediately preceding month.  The Growth Increment shall be the sum of the
daily interest earned, compounded monthly by the interest rate selected by
the Committee.

5.3  Share Accounts.  

(a)  Subject to applicable corporate policies, from time to time a
Participant may convert all or a portion of any Cash Account balance
of the Participant into deferred shares of Common Stock credited to
the Participant's corresponding Share Account by written notice to
the Corporation.  In such event, and effective as of the date the
Corporation receives such a notice, (i) there shall be credited to
the Participant's Share Account a number of units ("Share Units")
equal to the number of Share Units specified in the notice or, if
such notice specifies a dollar amount, a number of Share Units equal
to such dollar amount divided by the Fair Market Value on the last
trading business day immediately preceding the date the Corporation
receives such notice and (ii) the Participant's Cash Account shall be
debited in an amount equal to the number of Share Units credited to
the Share Account multiplied by the Fair Market Value on the same
trading business day.

(b)  Whenever cash dividends are paid by the Corporation on outstanding
Common Stock, as of the payment date for the dividend, there shall be
credited to a Participant's Cash Account an amount equal to the
amount per share of the cash dividend on the Common Stock multiplied
by the number of Share Units reflected in the Participant's Share
Account, if any, as of the close of business on the record date for
the dividend.

(c)  Subject to applicable corporate policies, from time to time a
Participant with a credit balance in a Share Account may convert all
or a portion of such balance into an amount to be credited to the
Participant's corresponding Cash Account by giving written notice to
the Corporation.  In such event, and effective as of the date the
Corporation receives such a notice, (i) there shall be credited to
the Participant's Cash Account an amount equal to the number of Share
Units specified in the notice multiplied by the Fair Market Value on
the last trading business day immediately preceding the date the
Corporation receives such notice and (ii) the Participant's Share
Account shall be debited by the number of Share Units specified in
the notice.

5.4  Charges Against Accounts.  There shall be charged against a
Participant's Cash Account any cash payments (excluding payments for
fractional shares) made to the Participant or to his beneficiary in
accordance with Section 6 hereof.  There shall be charged against a
Participant's Share Account any distributions made to the Participant or
to his beneficiary in respect of the Participant's Share Account in
accordance with Section 6 hereof.

Section 6.  Payment of Deferred Amounts

6.1  Payment of Deferred Amounts.  

(a)  Payment of a Participant's Cash Account balance, including
accumulated Growth Increments attributable thereto and dividend
credits under Section 5.3(b), shall be paid in cash commencing within
thirty calendar days after the commencement date referred to in
Section 4.2 hereof.  The payments shall be made in the manner
selected by the Participant under Section 4.3 of this Plan or, in the
absence thereof, in a lump sum.  The amount of each payment shall be
equal to a Participant's then distributable Cash Account balance
multiplied by a fraction, the numerator of which is one and the
denominator of which is the number of installment payments remaining.

(b)  Payment of a Participant's Share Account balance shall be paid
commencing within thirty calendar days after the commencement date
referred to in Section 4.2 hereof.  Payments in respect of a Share
Account balance shall be made by converting Share Units into Common
Stock on a one-for-one basis, with payment of fractional shares to be
made in cash based upon the Fair Market Value on the last trading
business day immediately preceding the date of payment; provided,
however, that at the election of a Participant, made by written
notice to the Corporation delivered not less than five business days
before a payment due date, payments in respect of a Share Account may
be made solely in cash in an amount equal to the number of Share
Units then payable multiplied by the Fair Market Value on the last
trading business day immediately preceding the date of payment.  The
payments shall be made in the manner selected by the Participant
under Section 4.3 of this Plan or, in the absence thereof, in a lump
sum.  The number of Share Units payable at the time of a payment
shall be equal to a Participant's then distributable Share Account
balance multiplied by a fraction, the numerator of which is one and
the denominator of which is the number of installment payments
remaining.

6.2  Acceleration of Payments.  If a Participant dies prior to the payment
of all or a portion of his Cash Account and/or Share Account balances, the
balance of any amounts payable shall be paid in a lump sum to the
beneficiaries designated under Section 7 hereof.  In addition, if a
Participant's Cash Account balance is less than $5,000 at the time for the
payment specified, such amount shall be paid to the Participant in a lump
sum, and if a Participant's Share Account balance is less than 200 Share
Units at the time for the payment specified, such amount shall be paid to
the Participant in a lump sum.

6.3  Financial Emergency.  The Committee, at its sole discretion, may
alter the timing or manner of payment of deferred amounts in the event
that the Participant establishes, to the satisfaction of the Committee,
severe financial hardship.  In such event, the Committee may:

(a)  provide that all, or a portion of, the amount previously deferred by
the Participant immediately shall be paid in a lump sum payment, 

(b)  provide that all, or a portion of, the installments payable over a
period of time immediately shall be paid in a lump sum, or

(c)  provide for such other installment payment schedules as it deems
appropriate under the circumstances, as long as the amount distributed
shall not be in excess of that amount which is necessary for the
Participant to meet the financial hardship.

Severe financial hardship will be deemed to have occurred in the
event of the Participant's impending bankruptcy, a dependent's long and
serious illness, or other events of similar magnitude.  The Committee's
decision in passing on the severe financial hardship of the Participant
and the manner in which, if at all, the payment of deferred amounts shall
be altered or modified shall be final, conclusive, and not subject to
appeal.

Section 7.  Beneficiary Designation

7.1  Designation of Beneficiary.  A Participant shall designate a
beneficiary or beneficiaries who, upon the Participant's death, are to
receive the amounts that otherwise would have been paid to the
Participant.  All designations shall be in writing to the Corporation in
such form as it requires or accepts and signed by the Participant.  The
designation shall be effective only if and when delivered to the
Corporation during the lifetime of the Participant.  The Participant also
may change his beneficiary or beneficiaries by a signed, written
instrument delivered to the Corporation.  However, if a married
Participant maintains his primary residence in a state that has community
property laws, the Participant's spouse shall join in any designation of a
beneficiary or beneficiaries other than the spouse.  The payment of
amounts shall be in accordance with the last unrevoked written designation
of beneficiary that has been signed and delivered to the Corporation.

7.2  Death of Beneficiary.  In the event that all of the beneficiaries
named in Section 7.1 predecease the Participant, the amounts that
otherwise would have been paid to the Participant shall be paid to the
Participant's estate, and in such event, the term "beneficiary" shall
include his estate.

7.3  Ineffective Designation.  In the event the Participant does not
designate a beneficiary, or if for any reason such designation is
ineffective, in whole or in part, the amounts that otherwise would have
been paid to the Participant shall be paid to the Participant's estate,
and in such event, the term "beneficiary" shall include his estate.

Section 8.  Rights of Participants

8.1  Contractual Obligation.  It is intended that the Corporation is under
a contractual obligation to make payments from a Participant's account
when due.  Payment of account balances payable in cash shall be made out
of the general funds of the Corporation as determined by the Board.

8.2  Unsecured Interest.  No Participant or beneficiary shall have any
interest whatsoever in any specific asset of the Corporation.  To the
extent that any person acquires a right to receive payments under this
Plan, such receipt shall be no greater than the right of any unsecured
general creditor of the Corporation.

8.3  Employment.  Nothing in the Plan shall interfere with or limit in any
way the right of the Corporation to terminate any Participant's employment
at any time, nor confer upon any Participant any right to continue in the
employ of the Corporation.

8.4  Participation.  No employee shall have a right to be selected as a
Participant or, having been so selected, to be selected again as a
Participant.

Section 9.

9.1  Nontransferability.  In no event shall the Corporation make any
payment under this Plan to any assignee or creditor of a Participant or a
beneficiary.  Prior to the time of a payment hereunder, a Participant or a
beneficiary shall have no rights by way of anticipation or otherwise to
assign or otherwise dispose of any interest under this Plan nor shall such
rights be assigned or transferred by operation of law.

Section 10.  Administration

10.1 Administration.  This Plan shall be administered by the Committee. 
The Committee may from time to time establish rules for the administration
of this Plan that are not inconsistent with the provisions of this Plan.

10.2 Finality of Determination.  The Committee has sole discretion in
interpreting the provisions of the Plan.  The determination of the
Committee as to any disputed questions arising under this Plan, including
questions of construction and interpretation, shall be final, binding, and
conclusive upon all persons.

10.3 Expenses.  The cost of payment from this Plan and the expenses of
administering the Plan shall be borne by the Corporation.

10.4 Action by the Corporation.  Any action required or permitted to be
taken under this Plan by the Corporation shall be by resolution of the
Board of Directors, by the duly authorized Committee of the Board of
Directors, or by a person or persons authorized by resolution of the Board
of Directors or the Committee.

Section 11.  Amendment and Termination

11.1 Amendment and Termination.  The Corporation expects the Plan to be
permanent but, since future conditions affecting the Corporation cannot be
anticipated or foreseen, the Corporation necessarily must and does hereby
reserve the right to amend, modify, or terminate the Plan at any time by
action of this Board.  Notwithstanding the foregoing, upon the occurrence
of a Potential Change of Control (as hereinafter defined) and for a period
of six months thereafter, the Plan may not be terminated or amended in a
manner adverse to Participants.   For purposes hereof, a "Potential Change
of Control" shall be deemed to have occurred if an event set forth in any
one of the following shall have occurred:

(i)  The Corporation enters into an agreement, the consummation of
which would result in the occurrence of a Change of Control;

(ii) The Corporation or any other Person publicly announces an
intention to take or consider taking actions that, if
consummated, would constitute a Change of Control;

(iii) Any Person becomes the beneficial owner, as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended (the
"Beneficial Owner"), directly or indirectly, of securities of
the Corporation representing 15% or more of either the then
outstanding shares of Common Stock or the combined voting power
of the Corporation's then outstanding voting securities; or

(iv) The Board adopts a resolution to the effect that, for purposes
of this Plan, a Potential Change of Control has occurred.

Section 12.  Applicable Law

12.1 Applicable Law.  This Plan shall be governed and construed in
accordance with the laws of the State of Wisconsin.

Section 13.  Withholding of Taxes

13.1 Tax Withholding.  The Corporation shall have the right to deduct from
all contributions made to, or payments made from, the Plan any federal,
state, or local taxes required by law to be withheld with respect to such
contributions or payments.  The Corporation may defer making payments in
the form of Common Stock under the Plan until satisfactory arrangements
have been made for the payment of any federal, state or local taxes
required to be withheld with respect to such payment or delivery.  Each
Participant shall be entitled to irrevocably elect, at least six months
prior to the date shares of Common Stock would otherwise be delivered
hereunder, to have the Corporation withhold shares of Common Stock having
an aggregate value equal to the amount required to be withheld.  The value
of fractional shares remaining after payment of the withholding taxes
shall be paid to the Participant in cash.  Shares so withheld shall be
valued at Fair Market Value on the last trading business day immediately
preceding the date such shares would otherwise be transferred hereunder.

Section 14.  Notice

14.1 Notice.  Any notice required or permitted to be given under the Plan
shall be sufficient if in writing and hand-delivered, or sent by a
registered or certified mail, and if given to the Corporation, delivered
to the principal office of the Corporation.  Such notice shall be deemed
given as of the date of delivery or, if delivery is made by mail, as of
the date shown on the postmark or the receipt for registration or
certification.

Section 15.  Common Stock Matters

15.1 Stock Reserved for the Plan.  The number of shares of Common Stock
authorized for issuance under the Plan is 50,000, subject to adjustment
pursuant to Section 15.3 hereof.  Shares of Common Stock delivered
hereunder shall be previously issued shares reacquired and held by the
Corporation.

15.2 General Restrictions.

(a)  Investment Representations.  The Corporation may require any
Participant, as a condition of receiving Common Stock, to give
written assurances in substance and form satisfactory to the
Corporation and its counsel to the effect that such person is
acquiring the Common Stock for his own account for investment and not
with any present intention of selling or otherwise distributing the
same, and to such other effects as the Corporation deems necessary or
appropriate in order to comply with federal and applicable state
securities laws.

(b)  Compliance with Securities Laws.  Delivery of Common Stock under the
Plan shall be subject to the requirement that, if at any time counsel
to the Corporation shall determine that the listing, registration or
qualification of the shares of Common Stock upon any securities
exchange or under any state or federal law, or the consent or
approval of any governmental or regulatory body, is necessary as a
condition of, or in connection with, the issuance of shares
thereunder, such shares may not be delivered in whole or in part
unless such listing, registration, qualification, consent or approval
shall have been effected or obtained on conditions acceptable to the
Committee.  Nothing herein shall be deemed to require the Corporation
to apply for or to obtain such listing, registration or
qualification.

15.3 Effect of Certain Changes in Capitalization.  If there is any change
in the number or class of shares of Common Stock through the declaration
of stock dividends, or recapitalization resulting in stock splits, or
combinations or exchanges of such shares or similar corporate
transactions, the maximum number or class of shares available under the
Plan, the number or class of shares of Common Stock to be delivered
hereunder and the number of Share Units in each Participant's Share
Account shall be proportionately adjusted by the Committee to reflect any
such change in the number or class of issued shares of Common Stock.

Section 16. Change of Control

16.1 Change of Control.  A "Change of Control" of the Company shall be
deemed to have occurred if:

(1)  any "Person" (as such term is defined in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), as modified and used in Sections 13(d) and 14(d) thereof,
except that for purposes of this section I.J.1.b and subsection
I.J.1.c., the term "Person" shall not include (i) the Company or
any of its subsidiaries, (ii) a trustee or other fiduciary
holding securities under an employee benefit plan of the Company
or any of its subsidiaries, (iii) an underwriter temporarily
holding securities pursuant to an offering of such securities,
or (iv) a corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of stock in the Company) is or
becomes the "Beneficial Owner" (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the
Company (not including in the securities beneficially owned by
such Person any securities acquired directly from the Company or
its affiliates) representing 25% or more of either the then
outstanding shares of common stock of the Company or the
combined voting power of the Company's then outstanding voting
securities; or

(2)  the following individuals cease for any reason to constitute a
majority of the number of directors then serving:  individuals
who, on January 1, 1996, constitute the Board and any new
director (other than a director whose initial assumption of
office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation,
relating to the election of directors of the Company, as such
terms are used in Rule 14a-11 of Regulation 14A under the
Exchange Act) whose appointment or election by the Board or
nomination for election by the Company's stockholders was
approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors on January 1,
1996 or whose appointment, election or nomination for election
was previously so approved; or

(3)  the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation or
approve the issuance of voting securities of the Company in
connection with a merger or consolidation of the Company (or any
direct or indirect subsidiary of the Company) pursuant to
applicable stock exchange requirements, other than (i) a merger
or consolidation which would result in the voting securities of
the Company outstanding immediately prior to such merger or
consolidation continuing to represent (either by remaining out-
standing or by being converted into voting securities of the
surviving entity or any parent thereof) at least 60% of the
combined voting power of the voting securities of the Company or
such surviving entity or any parent thereof outstanding
immediately after such merger or consolidation, or (ii) a merger
or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no Person is or
becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired
directly from the Company or its affiliates) representing 25% or
more of either the then outstanding shares of common stock of
the Company or the combined voting power of the Company's then
outstanding voting securities; or

(4)  the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company or an agreement for
the sale or disposition by the Company of all or substantially
all of the Company's assets (in one transaction or a series of
related transactions within any period of 24 consecutive
months), other than a sale or disposition by the Company of all
or substantially all of the Company's assets to an entity, at
least 75% of the combined voting power of the voting securities
of which are owned by Persons in substantially the same pro-
portions as their ownership of the Company immediately prior to
such sale.

Notwithstanding the foregoing, no "Change of Control" shall be deemed
to have occurred if there is consummated any transaction or series of
integrated transactions immediately following which the record
holders of the common stock of the Company immediately prior to such
transaction or series of transactions continue to have substantially
the same proportionate ownership in an entity which owns all or
substantially all of the assets of the Company immediately following
such transaction or series of transactions. 

16.2 Payments.  Upon the occurrence of a Change of Control, and
notwithstanding Section 6,

(a)  payment of a Participant's Cash Account balance shall be paid
immediately in cash in a lump sum; and

(b)  payment of a Participant's Share Account balance shall be paid
immediately in cash in a lump sum in an amount equal to the number of
Share Units in the Share Account multiplied by the Fair Market Value.

Exhibit (13)

PORTIONS OF ANNUAL REPORT TO SHAREHOLDERS

[Pages 16-19 of Annual Report]

Management's Discussion and Analysis of Results of Operations and
Financial Condition 

Results of Operations

(Note: All share and per share amounts in this Discussion reflect the
September 10, 1996 three-for-two split of the Corporation's common stock.)

Overview: Net sales grew 14.9% in 1996; acquisitions, higher unit volume
and modest price increases were all elements of the growth. Excluding
acquisitions, sales rose 5%. The translation of foreign-currency-
denominated results into U.S. dollars negatively affected sales by one
percentage point. North America and Europe posted sales growth, while
Other Non-U.S. revenues declined. In 1995, net sales increased 8.2%, with
higher sales in North America and Other Non-U.S. markets and lower results
in Europe.

Net earnings increased 16.0% in 1996 due to higher sales, continued
improvement in operating expenses as a percent of sales, and acquisitions.
In 1995, net earnings rose 15.3%, as higher gross margins resulting from
increased sales volumes and improved productivity, lower operating
expenses as a percent of net sales, and acquisitions all contributed to
the increase. Earnings per share increased 17.4% in 1996 and 20.0% in
1995. In 1995, earnings per share grew at a higher rate than net earnings
because of a share repurchase program that reduced the number of common
shares outstanding.

(Amounts in thousands)              1996        1995         1994
Net earnings                    $131,451    $113,330      $98,314
Earnings per common share       $   2.16    $   1.84      $  1.53

Sales: Sales in North America increased 10.5% in 1996 following a 9.7%
increase in 1995. The growth in both 1996 and 1995 was driven by higher
volumes from new product introductions; improved service levels; increased
sales to the dealer channel and to national accounts; price increases, and
a moderately strong U.S. economy. Contributions from the 1995 acquisitions
of Edge Diagnostic Systems ("Edge") and Consolidated Devices, Inc. ("CDI")
and the 1996 acquisition of the John Bean Company ("John Bean") were also
important factors in the increase. Excluding acquisitions, sales in 1996
rose 5%. Acquisitions accounted for more than one-third of the sales gain
in 1995. 

Sales in Europe increased 46.7% in 1996 following a decline of 4.4% in
1995. The 1996 year benefited from contributions from the 1995 acquisition
of Herramientas Eurotools, S.A. of Spain ("Eurotools") and the 1996
acquisition of John Bean, higher sales through the dealer channel, and
equipment sales related to the start-up of an emissions-testing program in
the United Kingdom. Excluding acquisitions, sales increased 8% in 1996.
The translation of foreign currencies into U.S. dollars negatively
affected sales; excluding the translation effects, 1996 sales grew 49%.
The 1995 decline in sales was due to reduced emissions-testing equipment
sales in Germany. Hand tool and other equipment sales, however, were
positive contributors.

Sales in Other Non-U.S. markets declined 1.1% in 1996 after an increase of
22.9% in 1995. Growth in tool and equipment sales in Australia were more
than offset by a decline in sales in Japan. The strength of the U.S.
dollar against the Japanese yen and general weakness in the Japanese
economy were primarily responsible for the 1996 decrease. Excluding the
net effects of foreign currency, 1996 sales increased 5%. In 1995, strong
sales were recorded by most of the countries in this geographic category.
1995 results also benefited from a weak U.S. dollar relative to the
Japanese yen.

(Amounts in thousands)              1996         1995         1994
North American sales          $1,138,016   $1,029,516   $  938,126
European sales                   268,818      183,301      191,648
Other Non-U.S. sales              78,445       79,308       64,522
----------   ----------   ----------
Total sales                   $1,485,279   $1,292,125   $1,194,296
==========   ==========   ==========

The Corporation manufactures, markets and distributes tools and equipment
for the automotive and industrial service markets around the world using
multiple brands sold through multiple channels of distribution. In some
instances, it finances the purchase of those products.

Increased sales of tools were attributable primarily to the continued
success of the dealer network in serving its customers and to the full-
year contributions of the Eurotools and CDI acquisitions completed in
1995. Equipment revenues benefited from new product introductions such as
the Vantage multimeter, from increased business with national account
customers, from emissions-testing equipment sales in several countries,
and from the 1995 acquisition of Edge and the 1996 acquisition of John
Bean. A review of net finance income is included in the "Cost and Profit
Margins" section of this Discussion.

Sales per employee, a common measure of productivity, increased 11% in
1996 over 1995. Since 1992, sales per employee has grown 28%.

During the year, the Corporation increased prices by varying degrees in
each of its product groups. List price increases averaged 2.9% in 1996 and
3.0% in 1995. Promotional activities reduced the revenue realization of
these price increases.

Cost and profit margins: The gross profit margin was 50.5% in 1996
compared with 51.3% in 1995 and 51.0% in 1994. The decline in 1996's gross
margin was due to a change in business mix resulting from several recent
acquisitions. In 1995, gross margins increased as a result of improved
productivity and higher factory utilization rates.

Total operating expenses as a percent of net sales continued to decline;
the 1996 percentage was 40.0% compared with 41.6% in 1995 and 42.7% in
1994. Higher sales volumes, continued improvement in processes and in
productivity, a change in business mix, and other general overhead
reductions all contributed to the decline. The decrease in 1995 was the
result of higher sales volumes, lower legal expenses, realization of the
full benefits of inventory, customer service and facilities
consolidations, and other overhead reductions. Total operating expenses
rose $56.5 million, compared with increases of $27.7 million in 1995 and
$0.5 million in 1994. All three years' increases were primarily due to
acquisitions.

Operating income margins improved to 14.8% in 1996 from 14.6% in 1995 and
13.3% in 1994. In 1996, lower operating expenses as a percent of sales
more than offset the lower gross margin. In 1995, higher gross margins and
lower operating expenses as a percent of sales both contributed to the
increased margin.

Net finance income was $64.3 million in 1996, compared with $63.2 million
in 1995 and $60.5 million in 1994. The Corporation uses its financing
programs to facilitate sales and does not actively seek to increase
finance income as a direct source of earnings growth. The rise in net
finance income in 1996 and 1995 was the result of increases in both
extended credit receivables and lease receivables, and benefits from
programs to control related costs. This growth was offset in part by the
asset securitization program discussed in the next paragraph.

In the first and fourth quarters of 1996, the Corporation sold $50 million
and $25 million, respectively, of its extended credit receivables, with
the proceeds used to pay down short-term debt and for working capital and
general corporate purposes. The effect of the asset securitization is a
decline in net finance income offset by an equivalent decline in interest
expense. In the fourth quarter of 1995, the Corporation sold $100 million
of its extended credit receivables.

In 1996, the Corporation adopted Statement of Financial Accounting
Standards (SFAS) No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of" and SFAS No. 123,
"Accounting for Stock-Based Compensation." The adoption of these
statements had no impact on the consolidated financial statements. In the
first quarter of 1997, the Corporation will adopt SFAS No. 125,
"Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities." The Corporation does not anticipate that
the adoption of this standard will have any impact on the consolidated
financial statements.

Other income and expenses: Interest expense recorded in 1996 was $12.6
million, compared with $13.3 million in 1995 and $10.8 million in 1994.
The decrease in 1996 is primarily due to the effects of the asset
securitization program. The 1995 increase reflected higher borrowings to
repurchase stock and finance acquisitions.

(Amounts in thousands)              1996        1995         1994
Interest expense                $(12,649)   $(13,327)    $(10,806)
Interest income                    2,134       3,222        2,799
Other income (expense)            (1,358)      1,350        2,742
--------    --------     --------
Total other expense             $(11,873)   $ (8,755)    $ (5,265)
========    ========     ========

Income taxes: The Corporation's effective tax rate was 37.0% in 1996,
37.0% in 1995 and 36.0% in 1994. The Corporation's effective tax rate was
lower in 1994 as a result of an increase in the operating income from
those subsidiaries that benefit from the utilization of net operating loss
carryforwards ("NOLs"). The Corporation has U.S. tax NOLs acquired in
acquisitions totaling $48.2 million and non-U.S. tax NOLs of $19.5 million
resulting from operations primarily in Australia, Canada, Mexico and the
Netherlands. See Note 7 for a further discussion of income taxes.

Other matters: During 1996, the Corporation acquired three new business
operations for an aggregate purchase price of $38.7 million. These
operations are John Bean, Automotive Data Solutions ("ADS") and Snap-on
Tools/PST Africa (Pty.), Ltd. ("Snap-on Tools/PST Africa"). 

John Bean is a leading producer of wheel and brake service 
equipment, including wheel aligners and balancers, tire changers and brake
lathes. Its products are sold in North America, Europe and select other
parts of the world. The acquisition extends the Corporation's reach in the
global market for under-car service. It also provides greater access to
original equipment manufacturers, national service chains and other
service repair providers through John Bean's traditional distributor
channel.

ADS is a tele-diagnostics service for automotive technicians. Its master
technicians and database of repair solutions provide the Corporation with
a core competency that can enrich current customer relationships and serve
as the basis for the generation of new business.

Snap-on Tools/PST Africa is a mobile van distributor of tools to
professional users in South Africa. The acquisition represents the
Corporation's first operation in that country, which can be used as a base
for the region.

Subsequent to the close of 1996, the Corporation acquired a 50 percent
interest in The Thomson Corporation's Mitchell Repair Information
business. Snap-on will purchase the remainder of the newly formed Mitchell
Repair Information Company, LLC within the next five years. The new
company is the largest provider of print and electronic versions of
vehicle mechanical and electrical system repair information to repair and
service establishments throughout North America. The acquisition will
enable the Corporation to offer a complete package of integrated
information and business services to vehicle repair centers around the
world. The integration of the vehicle repair database into the
Corporation's diagnostics equipment is also an important benefit of the
relationship.

The Corporation guaranteed payment (the "Guaranty") of certain lease
obligations of a former subsidiary in the aggregate amount of $98.8
million plus an interest factor in connection with a centralized
emissions-testing program in the State of Texas. Subsequently, the State
of Texas enacted legislation designed to terminate its centralized
emissions testing program. Litigation was commenced with respect to the
emissions-testing program and related contracts. The Corporation is making
regular monthly payments under the Guaranty. The Corporation believes that
it is probable that there will be developments, prior to the end of the
1997 Texas legislative session (approximately May 1997), to enable the
lease obligations to ultimately be recovered. Therefore, it is
management's opinion that the Guaranty is not likely to have a material
adverse effect on the Corporation's financial condition or results of
operations. Refer to Note 13 for an expanded discussion of the Guaranty.

Stock repurchase program: An authorization by the board of directors is
currently in effect to repurchase common shares of the Corporation in an
amount equivalent to the number of shares issued in connection with the
exercise of options, employee and dealer stock purchase programs, and
other similar issuances. The intent of this authorization is to prevent
dilution of shareholders' interests. In 1996, 615,750 shares of the
Corporation's common stock were repurchased. In May 1995, the Corporation
completed a program authorized by the board of directors to repurchase
$100 million in common shares. A total of 4.2 million shares were
repurchased under the program, representing approximately 6.5% of total
shares outstanding at the time the repurchase was authorized.

Stock split: At its June 1996 meeting, the board of directors voted to
split the Corporation's common stock. Shareholders of record on August 20,
1996, received one additional share for every two owned on that date. The
distribution of the shares was made on September 10, 1996.

Financial Condition

Overview: The Corporation continued its commitment to a strong financial
position and solid capital structure in 1996. At the end of 1996, the
ratio of total debt to total capital declined to 17.3% from 18.5% as of
year-end 1995, reflecting strong cash flow that enabled the Corporation to
invest in its businesses and satisfy its obligations without significantly
increasing its total debt.

Liquidity:  In 1996, the Corporation's working capital increased by $65.3
million following a decline of $24.5 million in 1995. Acquisitions
primarily accounted for the increase in 1996. The ratio of current assets
to current liabilities was 3.0 to 1 at the end of 1996, compared with 2.8
to 1 at the end of 1995. Cash and short-term investments were $15.4
million, a decrease of $0.8 million from year-end 1995's $16.2 million.

Accounts receivable increased $41.7 million to $651.7 million. The growth
in accounts receivable was partially offset by the asset securitization
program discussed previously and in Note 5. Exclusive of the asset
securitization effected in 1996, receivables increased by $116.7 million,
reflecting continued strong growth in various financing instruments
(including extended credit installment contracts and leases) provided by
the Corporation, and acquisitions. These financing instruments represent a
majority of the Corporation's accounts receivable and currently average
approximately 20.5 months in duration. The remaining accounts receivable
include those from dealers, industrial customers and governments. The
percentage of total write-offs for bad debts improved to 1.5% of average
accounts receivable in 1996 from 1.7% in 1995, reflecting the
effectiveness of the Corporation's credit extension and collections
practices.

Inventories increased by $19.3 million to $269.8 million, primarily
because of acquisitions. Inventories related to the Corporation's
continuing operations were $5.4 million higher at the end of 1996, from
$250.4 million at the close of 1995.

(Amounts in thousands)              1996         1995
Current assets                $1,017,324     $946,689
Current liabilities              341,371      336,075
Working capital               $  675,953     $610,614
Current ratio                   3.0 to 1     2.8 to 1

Short-term debt at the 1996 year end was $23.3 million, a decrease from
$27.1 million at year-end 1995. Current maturities of long-term debt at
the end of 1996 and 1995 were $0.3 million and $0.9 million. In addition,
at year-end 1996, the Corporation had $42.0 million in short-term
commercial notes payable outstanding that were classified as long term
since it is the Corporation's intent, and it has the ability, to refinance
this debt on a long-term basis, supported by its $100 million revolving
credit facility. In 1995, the Corporation had on file a $300 million shelf
registration that allows the Corporation to issue from time to time up to
$300 million of unsecured indebtedness. Of this amount, $100 million
aggregate principal amount of its notes were issued to the public in
October 1995.

These sources of borrowing, coupled with cash from operations, are
sufficient to support working capital requirements, finance capital
expenditures, make acquisitions and pay dividends. The Corporation's high
credit rating over the years has ensured that external funds are available
at a reasonable cost. At the end of 1996, the Corporation's long-term debt
was rated Aa3 and AA by Moody's Investor Service and Standard & Poor's,
respectively. The strength of the Corporation's balance sheet provides the
financial flexibility to respond to growth opportunities existing
internally and through acquisition.

Capital expenditures/Depreciation and amortization:  Capital expenditures
for 1996 totaled $52.3 million, an increase of $20.8 million over 1995.
Investments for the year included normal replacement and upgrading of
manufacturing and distribution facilities and equipment, upgrading and
integration of the Corporation's computer systems, and the construction of
a new hand tool manufacturing facility in Spain for Eurotools. The
Corporation anticipates capital expenditures in 1997 to total $35 to $40
million.

Depreciation for 1996 was $26.6 million, up $1.1 million from 1995. The
growth was primarily related to acquisitions. Amortization expense in 1996
was $5.2 million, a decline of $0.8 million from 1995. In 1995, intangible
amortization expense included the write-off of certain research and
development in process related to the acquisition of a majority ownership
interest in Edge during the year. Excluding this 1995 action, amortization
expense in 1996 would have shown an increase because of recent
acquisitions.

(Amounts in thousands)                    1996         1995
Capital expenditures                   $52,333      $31,581
Depreciation                            26,644       25,503
Amortization                             5,235        6,031

Dividends: At its June 1996 meeting, the board of directors declared an
11.1% increase in the quarterly dividend on the Corporation's common
stock, raising the annual dividend rate to $.80 per share. The Corporation
has paid consecutive quarterly dividends since 1939.

(Amounts in thousands)                    1996         1995
Cash dividends paid                    $46,323      $44,113
Cash dividends per common share            .76          .72
Cash dividends as a % of net income      35.2%        38.9%

[Pages 20-35 of Annual Report]

Consolidated Statements of Earnings

(Amounts in thousands except share data)  1996          1995          1994

Net sales                          $ 1,485,279   $ 1,292,125   $ 1,194,296
Cost of goods sold                     734,495       628,634       585,459
-----------   -----------   -----------
Gross profit                           750,784       663,491       608,837

Operating expenses                     594,527       538,021       510,361
Net finance income                     (64,269)      (63,174)      (60,458)
-----------   -----------   -----------
Operating income                       220,526       188,644       158,934

Interest expense                       (12,649)      (13,327)      (10,806)
Other income - net                         776         4,572         5,541
-----------   -----------   -----------
Earnings before income taxes           208,653       179,889       153,669

Income taxes                            77,202        66,559        55,355
-----------   -----------   -----------
Net earnings                       $   131,451   $   113,330   $    98,314
===========   ===========   ===========
Earnings per weighted 
average common share               $      2.16   $      1.84   $      1.53
===========   ===========   ===========
Weighted average common 
shares outstanding                  60,967,865    61,510,500    64,187,874
===========   ===========   ===========

The accompanying notes are an integral part of these statements.

Consolidated Balance Sheets
Dec. 28,        Dec. 30,
(Amounts in thousands except share data)             1996            1995

Assets
Current assets
Cash and cash equivalents                       $   15,350      $   16,211
Accounts receivable, less allowance 
for doubtful accounts of $16.9 million 
in 1996 and $14.7 million in 1995                 651,739         610,064
Inventories                                        269,750         250,434
Prepaid expenses and other assets                   80,485          69,980
----------      ----------
Total current assets                             1,017,324         946,689

Property and equipment - net                       245,294         220,067
Deferred income tax benefits                        55,413          61,471
Intangible and other assets                        202,757         132,746
----------      ----------
Total assets                                    $1,520,788      $1,360,973
==========      ==========
Liabilities and shareholders' equity
Current liabilities
Accounts payable                                $   89,310      $   75,603
Notes payable and current maturities 
of long-term debt                                  23,274          27,126
Accrued compensation                                36,467          37,769
Dealer deposits                                     51,036          65,344
Accrued income taxes                                11,366          16,106
Other accrued liabilities                          129,918         114,127
----------      ----------
Total current liabilities                          341,371         336,075

Long-term debt                                     149,804         143,763
Deferred income taxes                                7,027           4,760
Retiree health care benefits                        84,593          80,665
Pension and other long-term liabilities            109,832          44,978
----------      ----------
Total liabilities                                  692,627         610,241

Shareholders' equity
Preferred stock - authorized 15,000,000 
shares of $1 par value; none outstanding                -               -
Common stock - authorized 125,000,000 
shares of $1 par value; issued 

65,971,917 and 43,571,363 shares                   65,972          43,571
Additional paid-in capital                          66,506          74,250
Retained earnings                                  838,484         753,356
Foreign currency translation adjustment            (13,930)        (10,758)
Treasury stock at cost - 5,186,550 
and 3,047,200 shares                             (128,871)       (109,687)
----------      ----------
Total shareholders' equity                         828,161         750,732
----------      ----------
Total liabilities and shareholders' equity      $1,520,788      $1,360,973
==========      ==========

The accompanying notes are an integral part of these statements.

Consolidated Statements of Shareholders' Equity

(Amounts in thousands except share data)      1996        1995       1994

Common stock
Amount at beginning of year               $ 43,571    $ 43,128   $ 42,819 
Shares issued under stock purchase
and option plans                              410         425        291 
Three-for-two stock split                   21,971           -          - 
Dividend reinvestment plan                      20          18         18 
--------    --------   --------
Amount at end of year                       65,972      43,571     43,128 

Additional paid-in capital
Amount at beginning of year                 74,250      61,827     52,153 
Additions from stock purchase 
and option plans                           12,436      11,778      8,779 
Tax benefit from certain stock 
options and other items                     1,031           -        264 
Three-for-two stock split                  (21,971)          -          - 
Dividend reinvestment plan                     760         645        631 
--------    --------   --------
Amount at end of year                       66,506      74,250     61,827 

Retained earnings
Amount at beginning of year                753,356     684,139    632,022 
Net earnings for the year                  131,451     113,330     98,314 
Dividends per share paid in 
cash - $.76 in 1996, $.72
in 1995 and $.72 in 1994                  (46,323)    (44,113)   (46,197)
--------    --------   --------
Amount at end of year                      838,484     753,356    684,139 

Foreign currency translation adjustment
Amount at beginning of year                (10,758)    (13,384)   (16,019)
Net currency translation 
adjustment for the year                    (3,172)      2,626      2,635 
--------    --------   --------
Amount at end of year                      (13,930)    (10,758)   (13,384)

Treasury stock at cost
Amount at beginning of year               (109,687)     (9,312)    (9,312)
Treasury stock purchased at cost           (19,184)   (100,375)         - 
--------    --------   --------
Amount at end of year                     (128,871)   (109,687)    (9,312)
--------    --------   --------
Total shareholders' equity                $828,161    $750,732   $766,398 
========    ========   ========

The accompanying notes are an integral part of these statements.

Consolidated Statements of Cash Flows

(Amounts in thousands)                        1996        1995       1994 

Operating activities
Net earnings                              $131,451    $113,330   $ 98,314 
Adjustments to reconcile net earnings
to net cash provided by operating
activities:
Depreciation                              26,644      25,503     26,893 
Amortization of intangibles                5,235       6,031      2,739 
Deferred income tax provision              8,398     (10,098)    (1,103)
Gain on sale of assets                      (876)       (236)    (2,938)
Changes in operating assets 
and liabilities, net of effects
of acquisitions:
(Increase) in receivables                (29,591)    (18,267)   (27,256)
(Increase) decrease in inventories       (10,543)       (121)    32,331 
(Increase) decrease in prepaid
expenses                                  3,361      (3,989)   (15,470)
Increase (decrease) in accounts
payable                                   12,069      10,786     (1,453)
Increase (decrease) in accruals,
deposits, and other long-term
liabilities                              (16,427)     49,961     (4,882)
--------    --------    -------
Net cash provided by 
operating activities                       129,721     172,900    107,175 

Investing activities
Capital expenditures                       (52,333)    (31,581)   (41,788)
Acquisitions of businesses                 (38,553)    (37,965)   (23,332)
Disposition of business                          -           -     26,611 
Disposal of property and equipment           3,317       5,961     10,017 
(Increase) decrease in 
other noncurrent assets                      6,679      (7,627)    (3,219)
--------    --------    -------
Net cash used in investing activities      (80,890)    (71,212)   (31,711)

Financing activities
Payment of long-term debt                  (40,902)    (99,150)      (807)
Increase in long-term debt                  46,205     133,513        427 
Increase (decrease) in 
short-term borrowings - net                 (4,112)      3,109    (35,826)
Purchase of treasury stock                 (19,184)   (100,375)         - 
Proceeds from stock purchase 
and option plans                            14,656      12,866      9,983 
Cash dividends paid                        (46,323)    (44,113)   (46,197)
--------    --------    -------
Net cash used in financing activities      (49,660)    (94,150)   (72,420)

Effect of exchange rate changes
on cash                                       (32)       (342)      (758)
--------    --------    -------
Increase (decrease) in cash 
and cash equivalents                          (861)      7,196      2,286 

Cash and cash equivalents at 
beginning of year                           16,211       9,015      6,729 
--------    --------    -------
Cash and cash equivalents at 
end of year                               $ 15,350    $ 16,211    $ 9,015 
========    ========    =======

The accompanying notes are an integral part of these statements.

Notes to Consolidated Financial Statements

Note 1 - Summary of Accounting Policies

A summary of significant accounting policies applied in the preparation of
the accompanying consolidated financial statements follows:

a. Nature of operations: The Corporation is a leading global developer,
manufacturer and distributor of hand and power tools, diagnostic hardware
and software, shop equipment, and tool storage products. The Corporation's
customers include professional automotive technicians and shop owners,
original equipment manufacturers and industrial tool users worldwide.

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

c. Principles of consolidation: The consolidated financial statements
include the accounts of the Corporation and its subsidiaries, all of which
are wholly owned with the exception of Edge and Snap-on Tools/PST Africa.
Significant intercompany accounts and transactions have been eliminated.

d. Accounting period: The Corporation's accounting period ends on the
Saturday nearest December 31. The 1996, 1995 and 1994 years ended on
December 28, 1996, December 30, 1995 and December 31, 1994.

e. Cash equivalents: The Corporation considers all highly liquid
investments with an original maturity of three months or less to be cash
equivalents. Cash equivalents are stated at cost, which approximates
market value.

f. Inventories: Inventories are stated at the lower of cost or market.
Cost elements include the cost of raw materials, direct labor and overhead
incurred in the manufacturing process. For detailed inventory information,
refer to Note 2.

g. Property and equipment: Depreciation and amortization are calculated
primarily on a straight-line basis. Accelerated methods are used for
income tax purposes. For detailed property and equipment information,
refer to Note 3.

h. Intangibles: During 1996, the Corporation made three acquisitions with
an aggregate purchase price of $38.7 million. During 1995, the Corporation
made three acquisitions with an aggregate purchase price of $61.2 million.
Pro forma results of operations are not presented, as the effect of these
acquisitions is not material. Goodwill arising from business acquisitions
is included in Intangible and Other Assets in the accompanying
Consolidated Balance Sheets and is being amortized principally over 20
years on a straight-line basis. The Corporation continually evaluates the
existence of goodwill impairment on the basis of whether the goodwill is
fully recoverable from projected, undiscounted net cash flows of the
related business unit. 

Subsequent to year-end 1996, the Corporation acquired a 50 percent
interest in The Thomson Corporation's Mitchell Repair Information business
at a purchase price of $40.0 million. The Corporation is obligated to
purchase the remainder of the newly formed Mitchell Repair Information
Company within the next five years.

Goodwill, net of accumulated amortization, was $80.8 million and $78.0
million at the end of 1996 and 1995. Goodwill amortization was $4.8
million, $3.9 million and $3.2 million for 1996, 1995 and 1994.
Accumulated amortization of goodwill was $18.1 million and $13.3 million
at the end of 1996 and 1995. 

i. Research and engineering: Research and engineering costs are charged to
expense in the year incurred. For 1996, 1995 and 1994, these costs were
$42.4 million, $33.9 million and $30.6 million.

j. Income taxes: Deferred income taxes are provided for temporary
differences arising from differences in bases of assets and liabilities
for tax and financial reporting purposes. Deferred income taxes are
recorded on temporary differences at the tax rate expected to be in effect
when the temporary differences reverse. For detailed tax information,
refer to Note 7.

k. Foreign currency translation: The financial statements of the
Corporation's foreign subsidiaries are translated into U.S. dollars in
accordance with Statement of Financial Accounting Standards (SFAS) No. 52,
"Foreign Currency Translation." Net assets of certain foreign subsidiaries
are translated at current rates of exchange, and income and expense items
are translated at the average exchange rate for the year. The resulting
translation adjustments are recorded directly into a separate component of
shareholders' equity. Certain other translation adjustments and
transaction gains and losses are reported in net income and were not
material in any year.

l. Revenue recognition: The Corporation recognizes revenues at the time
that products are shipped or the time that services are performed.
Franchise fee revenue is recognized as the fees are earned. Revenue from
franchise fees was not material in any year.

m. Net finance income: Net finance income consists of installment contract
income, dealer start-up loan receivable income and lease income, net of
related expenses.

n. Advertising and promotion expense: Production costs of future media
advertising are deferred until the advertising occurs. All other
advertising and promotion costs are generally expensed when incurred.

o. Warranty expense policy: The Corporation provides product warranties
for specific product lines and accrues for estimated future warranty costs
in the period that the sale was recorded.

p. Accounting standards: In 1996, the Corporation adopted Statement of
Financial Accounting Standards (SFAS) No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of" and SFAS No. 123, "Accounting for Stock-Based Compensation." The
adoption of these statements had no impact on the consolidated financial
statements. In the first quarter of 1997, the Corporation will adopt SFAS
No. 125, "Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities." The Corporation does not anticipate that
the adoption of this standard will have any impact on the consolidated
financial statements.

q. Reclassified prior-year amounts: Certain prior-year amounts have been
reclassified to conform with current-year presentation.

r. Per share data: In June 1996, the board of directors approved a three-
for-two split of the Corporation's common stock, which was distributed on
September 10, 1996 to shareholders of record on August 20, 1996. All prior
year and certain 1996 per share and weighted average share information has
been restated.

Note 2 - Inventories

The components of the Corporation's inventory were as follows for the
years ended:

(Amounts in thousands)                  1996           1995 
Finished stock                      $271,785       $264,184 
Work in process                       42,483         39,977 
Raw materials                         62,057         56,191 
Excess of current cost 
over LIFO cost                     (106,575)      (109,918)
--------       --------
Total inventory                     $269,750       $250,434 
========       ========

Inventories accounted for using the last-in, first-out (LIFO) cost method
approximated 73% and 63% of total inventory as of year-end 1996 and 1995.

Note 3 - Property and Equipment

The Corporation's property and equipment values, which are carried at
cost, were as follows:

(Amounts in thousands)                  1996           1995 
Land                                $ 24,337       $ 22,875 
Buildings and improvements           166,764        149,087 
Machinery and equipment              319,138        296,916 
--------       --------
510,239        468,878 
Less: accumulated depreciation      (264,945)      (248,811)
--------       --------
Property and equipment - net        $245,294       $220,067 
========       ========

The estimated service lives of property and equipment are principally as
follows:

Buildings and improvements      5 to 50 years
Machinery and equipment         3 to 15 years
Transportation vehicles          2 to 5 years

Note 4 - Litigation

At January 31, 1997, the Corporation was a party to various pending legal
proceedings in which approximately eight current or former U.S. dealers,
and in some cases their spouses, have asserted claims against the
Corporation, and approximately 14 current or former U.S. dealers have
threatened to assert claims against the Corporation. In most instances,
these claims include allegations that the Corporation made
misrepresentations, violated statutes or contract rights, and caused
distress. During 1996, 1995 and 1994, the Corporation charged earnings a
total of approximately $4.3 million, $4.9 million and $7.9 million for
settlement costs, including the establishment of related reserves, legal
fees and expenses with respect to dealer claims. Although it is not
possible to predict the outcome of the existing dealer claims with any
certainty, it is management's opinion, based in part on advice from its
legal counsel, that the costs, losses and settlements of these claims are
not expected to have a material adverse effect on the Corporation's
financial condition and results of operations. 

Note 5 - Receivables

Accounts receivable include installment receivable amounts that are due
beyond one year from balance sheet dates. These amounts were approximately
$47.6 million and $38.3 million at the end of 1996 and 1995. Gross
installment receivables amounted to $422.2 million and $433.1 million at
the end of 1996 and 1995. Of these amounts, $42.4 million and $59.6
million represented unearned finance charges at the end of 1996 and 1995.

The Corporation has an agreement with a financial institution to sell, on
an ongoing basis and with full recourse, up to $77.3 million of dealer
start-up loan receivables. During 1996 and 1995, the Corporation sold
$31.6 million and $29.5 million of these receivables to the financial
institution. At the end of 1996 and 1995, $56.5 million and $40.1 million
remained outstanding.

In October 1995, the Corporation entered into agreements that provide for
the sale, without recourse, of an undivided interest in a pool of certain
of its accounts receivable to a third-party financial institution. These
agreements, which include subsequent amendments, provide for a maximum of
$200 million of such accounts receivable to be sold and remain outstanding
at any one time. As of December 28, 1996, $175.0 million of interest-
bearing installment receivables were sold under these agreements on a
revolving basis, of which $100.0 million, $50.0 million and $25.0 million
were sold in October 1995, January 1996 and October 1996. The agreement
for revolving purchases terminates in October 1997. The sale is reflected
as a reduction of accounts receivable in the accompanying Consolidated
Balance Sheets and as operating cash flows in the accompanying
Consolidated Statements of Cash Flows. The impact of the sale on the
Consolidated Statements of Earnings was not material. Subsequent to year-
end, the Corporation sold an additional $25.0 million of interest-bearing
installment receivables under these agreements.

Note 6 - Short-term and Long-term Debt

Notes payable to banks under bank lines of credit totaled $22.9 million
and $26.2 million at the end of 1996 and 1995.

Commercial notes payable totaled $42.0 million and $30.0 million at the
end of 1996 and 1995. The commercial paper outstanding at year end is
classified as long-term debt since it is the Corporation's intent, and it
has the ability (supported by a $100 million revolving credit facility),
to refinance the debt on a long-term basis.

Under the terms of a $100 million revolving credit commitment entered into
by the Corporation in 1994, borrowings can be made at the London Interbank
Offered Rate in effect at the time of such borrowings plus 0.14% and may
be fixed for periods ranging from one to twelve months under reborrowing
provisions of the commitment. This commitment terminates on January 2,
2000. There were no borrowings under this revolving credit commitment at
the end of 1996 and 1995.

Under the commitment, the Corporation must maintain a specific level of
consolidated tangible net worth and meet certain leverage and subsidiary
indebtedness ratios. In addition, certain capital transactions are
restricted. At the end of 1996, the Corporation was in compliance with all
covenants of the commitment.

Maximum short-term debt outstanding at the end of any month was $64.9
million in 1996 and $154.7 million in 1995. The average short-term debt
outstanding was $41.9 million in 1996 and $69.2 million in 1995. The
weighted average interest rates were 6.0% in 1996 and 5.9% in 1995. The
weighted average interest rates on long-term and short-term debt
outstanding were 6.4% and 6.9% at December 28, 1996 and December 30, 1995.

The Corporation's long-term debt consisted of the following for the years
ended:

(Amounts in thousands)                  1996           1995 
Senior unsecured indebtedness       $100,000       $100,000 
Borrowings supported by a
revolving credit commitment          42,000         30,000 
Other long-term debt                   8,129          4,676 
--------       --------
150,129        144,676 
Less: current maturities                (325)          (913)
--------       --------
Total long-term debt                $149,804       $143,763 
========       ========

The annual maturities of the Corporation's long-term debt due in the next
five years are $0.3 million in 1997, $0.3 million in 1998 and $49.4
million in 2000.

In September 1994, the Corporation filed a registration statement with the
Securities and Exchange Commission that allows the Corporation to issue
from time to time up to $300 million of unsecured indebtedness. In October
1995, the Corporation issued $100 million of its notes to the public. The
notes require payment of interest on a semiannual basis at a rate of
6.625% and mature in their entirety on October 1, 2005. The proceeds of
this issuance were used to repay a portion of the Corporation's
outstanding commercial paper and for working capital and general corporate
purposes.

Interest payments on debt and on other interest-bearing obligations
approximated $13.2 million, $13.0 million and $11.6 million for 1996, 1995
and 1994.

Note 7 - Income Taxes

Earnings before income taxes consisted of the following:

(Amounts in thousands)                 1996           1995           1994 
U.S.                                172,553       $153,423       $117,509 
Foreign                              36,100         26,466         36,160 
--------       --------       --------
Total                              $208,653       $179,889       $153,669 
========       ========       ========

The provision for income taxes consists of the following:

(Amounts in thousands)                 1996           1995           1994 
Current:
Federal                           $ 55,949       $ 57,328       $ 36,279 
Foreign                             13,803         10,250         14,091 
State                                8,997          9,079          6,088 
--------       --------       --------
Total current                        78,749         76,657         56,458 

Deferred:
Federal                               (615)        (8,895)          (684)
Foreign                               (428)          (176)          (517)
State                                 (504)        (1,027)            98 
--------       --------       --------
Total deferred                       (1,547)       (10,098)        (1,103)
--------       --------       --------
Total income tax provision         $ 77,202       $ 66,559       $ 55,355 
========       ========       ========

A reconciliation of the Corporation's effective income tax rate to the
statutory federal tax rate follows for the years ended:

1996           1995           1994 

Statutory federal income tax rate      35.0%          35.0%          35.0%
Increase (decrease) in tax 
rate resulting from:
State income taxes, net of 
federal benefit                       2.4            2.5            2.7 
Foreign sales corporation 
tax benefit                          (1.5)          (1.8)          (1.9)
Other                                 1.1            1.3            0.2 
--------       --------       --------
Effective tax rate                     37.0%          37.0%          36.0%
========       ========       ========

Temporary differences that give rise to the net deferred tax benefit are
as follows:

(Amounts in thousands)                 1996           1995           1994 
Current deferred income 
tax benefit:
Inventories                      $ 14,599       $ 16,534       $ 15,007 

Accruals and reserves not
currently deductible              36,372         15,136         19,217 
Other                                  56          2,956            302 
--------       --------       --------
Total current (included 
in prepaid expenses)                 51,027         34,626         34,526 

Long-term deferred income tax benefit:
Employee benefits                  57,299         50,017         44,215 
Net operating losses               23,585         30,313         30,124 
Depreciation                      (13,409)       (18,118)       (17,239)
Other                              (6,528)         4,661          3,200 
Valuation allowance               (12,561)       (10,162)        (9,869)
--------       --------       --------
Total long-term                      48,386         56,711         50,431 
--------       --------       --------
Net deferred income tax benefit    $ 99,413       $ 91,337       $ 84,957 
========       ========       ========

The valuation allowance required under Statement of Financial Accounting
Standards (SFAS) No. 109, "Accounting for Income Taxes," has been
established for deferred income tax benefits related to certain subsidiary
loss carryforwards that may not be realized. Included in the valuation
allowance is $7.5 million that relates to the deferred tax assets recorded
from acquisitions. Any tax benefits subsequently recognized for these
deferred tax assets will be allocated to goodwill.

The Corporation has U.S. tax NOLs acquired from acquisitions totaling
$48.2 million that expire as follows: 2000-$10.9 million, 2002-$1.3
million, 2003-$14.0 million, 2004-$1.6 million, 2005-$14.0 million, 2006-
$1.5 million, 2007-$1.1 million and 2010-$3.8 million. The Corporation
also has non-U.S. tax NOLs of $19.5 million resulting from operations
primarily in Australia, Spain, Mexico and the Netherlands. These losses
expire as follows: 2000-$1.8 million, 2001-$0.3 million, 2010-$1.9 million
and 2011-$2.8 million. The remaining non-U.S. NOLs of $12.7 million may be
carried forward indefinitely. A valuation allowance has been established
in the amount of $3.4 million for the U.S. NOLs and $6.6 million for the
non-U.S. NOLs. Realization is dependent on generating sufficient taxable
income prior to expiration of the loss carryforwards. Although realization
is not assured, management believes it is more likely than not that the
deferred tax asset will be realized. The amount of the deferred tax asset
considered realizable, however, could be reduced in the near term if
estimates of future taxable income during the carryforward period are
reduced.

The undistributed earnings of all subsidiaries were approximately $120.3
million, $100.2 million and $85.4 million at the end of 1996, 1995 and
1994. The Corporation does not expect that additional income taxes will be
incurred on future distributions of such earnings and, accordingly, no
deferred income taxes have been provided for the distribution of these
earnings to the parent company.

The Corporation made income tax payments of $69.7 million, $63.5 million
and $65.9 million in 1996, 1995 and 1994.

Note 8 - Financial Instruments

Foreign Exchange Contracts: The Corporation enters into foreign currency
contracts to manage its exposure to foreign currency fluctuations in
receivables and payables denominated in foreign currencies. Gains and
losses on these contracts are recognized currently. These forward exchange
contract transactions generally mature quarterly, at which time they are
replaced with new contracts. At December 28, 1996, the Corporation had
forward exchange contracts to exchange British pounds, Spanish pesetas,
Irish punts, Dutch guilders and Australian dollars for a U.S.-dollar
equivalent of approximately $71 million.

Interest Rate Swap Agreements: The Corporation enters into interest rate
swap agreements to manage interest costs and risks associated with
changing interest rates. The differentials paid or received on interest
rate agreements are accrued and recognized as adjustments to interest
expense. Gains and losses realized upon settlement of these agreements are
deferred and amortized to interest expense over a period relevant to the
agreement if the underlying hedged instrument remains outstanding, or
immediately if the underlying hedged instrument is settled.

At December 28, 1996, the Corporation had swap agreements in place to pay
fixed rates ranging from 6.2% to 7.8% in exchange for floating interest
rate payment obligations on $25.6 million notional principal amount for
the years 1997 through 2004 and 6.0% on $10.1 million notional principal
amount through the year 2006. At December 30, 1995, the Corporation had
swap agreements on $28.1 million notional principal amount.

Credit Concentrations: The Corporation is exposed to credit losses in the
event of nonperformance by the counterparties to its interest rate swap
and foreign exchange contracts. The Corporation does not anticipate
nonperformance by the counterparties. The Corporation does not obtain
collateral or other security to support financial instruments subject to
credit risk but monitors the credit standing of the counterparties and
enters into agreements only with financial institution counterparties with
a credit rating of A- or better.

While the Corporation primarily sells to professional technicians and shop
owners, the Corporation's accounts receivable do not represent significant
concentrations of credit risk because of the diversified portfolio of
individual customers and geographic areas.

Fair Value of Financial Instruments: Statement of Financial Accounting
Standards (SFAS) No. 107, "Disclosure about Fair Value of Financial
Instruments," requires the Corporation to disclose the fair value of
financial instruments for both on- and off-balance sheet assets and
liabilities for which it is practicable to estimate that value. The
following methods and assumptions were used in estimating the fair value
for financial instruments:

Installment contracts: A discounted cash flow analysis was performed over
the average life of a contract using a discount rate currently available
to the Corporation adjusted for credit quality, cost and profit factors.
As of December 28, 1996 and December 30, 1995, the fair value was
approximately $408.2 million and $407.7 million versus a book value of
$379.7 million and $373.5 million.

Interest rate swap agreements: The fair value of the agreements was based
on a quote from the financial institution with which the Corporation
executed the transactions. As of December 28, 1996, the cost to terminate
the agreements was $0.9 million. As of December 30, 1995, the Corporation
would have realized a gain of $1.0 million upon termination of the
agreements. 

All other financial instruments: The carrying amounts approximate fair
value based on quoted market prices or discounted cash flow analysis for
cash equivalents, debt, forward exchange contracts and other financial
instruments.

Note 9 - Pension Plans

The Corporation has several noncontributory pension plans covering most
employees, including certain employees in foreign countries. Retirement
benefits are generally provided based on employees' years of service and
average earnings or stated amounts for years of service. Normal retirement
age is 65, with provisions for earlier retirement. The Corporation
recognizes retirement plan expenses in accordance with Statement of
Financial Accounting Standards (SFAS) No. 87, "Employers' Accounting for
Pensions," and contributes amounts to the plans, with most using the
actuarially computed entry age normal cost method, which includes, in
certain defined retirement benefit plans, amortization of past service
cost over 30 years.

The Corporation has several non-U.S. subsidiary pension plans that do not
report pension expense in accordance with SFAS No. 87, as these plans and
the related pension expense are not material.

The Corporation's net pension expense included the following components:

(Amounts in thousands)                 1996           1995           1994 
Service cost - benefits earned
during year                       $ 13,191       $ 10,813       $ 12,146 
Interest cost on projected 
benefits                            25,657         23,764         22,112 
Less actual return on 
plan assets                        (40,788)       (53,895)        (1,949)
Net amortization and deferral:
Actual return on plan assets
in excess of (less than) 
projected return                   14,226         28,721        (20,226)
Amortization of net assets
at transition                      (1,084)        (1,401)        (1,082)
Other                                 865          1,431            591 
--------       --------       --------
Net pension expense                $ 12,067       $  9,433       $ 11,592 
========       ========       ========

The funded status of the Corporation's U.S. pension plans was as follows:

1996                     1995
Assets     Accumulated    Assets     Accumulated
Exceed       Benefits     Exceed      Benefits
Accumulated     Exceed     Accumulated    Exceed
(Amounts in thousands)    Benefits     Assets      Benefits      Assets
Actuarial present value
of accumulated benefits:
Vested benefits        $249,753     $  6,166    $173,865       $ 63,180 
Non-vested benefits      38,221        2,348      28,970          8,238 
--------     --------   ---------       --------
Accumulated benefit 
obligation               287,974        8,514     202,835         71,418 
Effect of projected 
future salary 
increases                 48,485        2,946      45,949          5,153 
--------     --------   ---------       --------
Projected benefit 
obligation               336,459       11,460     248,784         76,571 
Plan assets at 
market value             370,058            -     262,293         64,738 
--------     --------   ---------       --------
Plan assets in 
excess of (less 
than) projected 
benefit obligation        33,599      (11,460)     13,509        (11,833)
Unrecognized net 
assets at year end        (7,119)          91      (6,230)        (1,744)
Unrecognized net 
(gain) or loss 
from experience 
different from assumed   (82,238)       3,292     (49,356)          (489)
Unrecognized prior 
service cost               9,708          493       4,956          5,309 
Additional minimum
liability                     -          (640)          -           (846)
--------     --------   ---------       --------
Pension liability        $(46,050)    $ (8,224)  $ (37,121)      $ (9,603)
========     ========   =========       ========

The actuarial present value of the projected benefit obligation was
determined using a discount rate of 7.75% for 1996 and 1995. The projected
future salary increase assumption was 5.0% and the expected long-term rate
of return on plan assets was 9.0% for the two years reported.

Plan assets are stated at market value and primarily consist of corporate
equities and various debt securities.

The pension liability for 1996 consists of a current liability of $9.8
million and a long-term liability of $44.5 million. The long-term
liability represents pension obligations that are not expected to be
funded during the next 12 months.

Note 10 - Retiree Health Care

The Corporation provides certain health care benefits for most retired
U.S. employees. The majority of the Corporation's U.S. employees become
eligible for those benefits if they reach early retirement age while
working for the Corporation; however, the age and service requirements for
eligibility under the plans have been increased for certain employees
hired on and after specified dates since 1992. Generally, most plans pay
stated percentages of covered expenses after a deductible is met. There
are several plan designs, with more recent retirees being covered under a
comprehensive major medical plan. In determining benefits, the plans take
into consideration payments by Medicare and other coverages.

For employees retiring under the comprehensive major medical plans, there
are contributions required, and these plans contain provisions allowing
for benefit and coverage changes. The plans require retirees to contribute
either the full cost of the coverage or amounts estimated to exceed a
capped per retiree annual cost commitment by the Corporation. Most
employees hired since 1994 are required to pay the full cost. The
Corporation does not fund the retiree health care plans.

The Corporation recognizes postretirement health care expense in
accordance with Statement of Financial Accounting Standards (SFAS) No.
106, "Employers' Accounting for Postretirement Benefits Other than
Pensions."

The components of the expense for postretirement health care benefits are
as follows:

(Amounts in thousands)                    1996         1995         1994 
Service cost - benefits attributed
to service during the period          $ 2,012      $ 1,707      $ 2,139 
Interest cost on accumulated 
postretirement benefit obligation       5,273        5,228        5,081 
Amortization of unrecognized 
net gain                                 (487)        (622)           - 
-------      -------      -------
Net postretirement health 
care expense                          $ 6,798      $ 6,313      $ 7,220 
=======      =======      =======

The components of the accumulated postretirement benefit obligation are as
follows:

(Amounts in thousands)                                 1996           1995
Accumulated postretirement benefit obligation
Retirees                                         $ 35,329       $ 37,215
Fully eligible active plan participants            11,481         10,810
Other active plan participants                     26,205         23,642
--------       --------
Accumulated postretirement benefit obligation        73,015         71,667
Unrecognized net gain                                15,067         11,998
--------       --------
Postretirement liability                           $ 88,082       $ 83,665
========       ========

The accumulated postretirement benefit obligation at the end of 1996
consists of a current liability of $3.5 million and a long-term liability
of $84.6 million. The weighted average discount rate used in determining
the accumulated postretirement benefit obligation was 7.75% at the end of
1996 and 1995.

The actuarial calculation assumes a health care trend rate of 9.2% in 1997
for benefits paid on pre-Medicare retirees, decreasing gradually to 5.0%
in the year 2003 and thereafter. For benefits paid on Medicare-eligible
retirees, a health care trend rate of 8.1% was assumed in 1997, decreasing
to 5.0% in the year 2007 and thereafter.

As of December 28, 1996, a one percentage point increase in the health
care cost trend rate for future years would not materially affect the
accumulated postretirement benefit obligation or the service cost and
interest cost components.

Note 11 - Corporation Stock Option and Purchase Plans

On June 28, 1996, the board of directors approved a three-for-two stock
split of the Corporation's common stock to shareholders of record on
August 20, 1996. Distribution of shares in connection with the stock split
was made on September 10, 1996. All share-related amounts in this note
reflect that split.

On April 26, 1996, shareholders approved the board of directors' request
to reserve 1,500,000 additional common shares for issuance under the 1986
Amended and Restated Incentive Stock Program.

The Corporation has a stock option plan for directors, officers and key
employees, with expiration dates on the options ranging from 1999 to 2006.
The plan provides that options be granted at exercise prices equal to
market value on the date the option is granted.

The Corporation offers shareholders a convenient way to increase their
investment in the Corporation through a no-commission dividend
reinvestment and stock purchase plan. Participating shareholders may
invest the cash dividends from all or a portion of their common stock to
buy additional shares. The program also permits shareholders to invest
cash for additional shares that are purchased for them each month. For
1996, 1995 and 1994, shares issued under the dividend reinvestment and
stock purchase plan totaled 24,283, 26,567 and 26,987. At December 28,
1996, 1,349,402 shares were reserved for issuance to shareholders under
this plan.

Employees of the Corporation are entitled to participate in an employee
stock ownership plan. The purchase price of the common stock is the lesser
of the mean of the high and low price of the stock on the beginning date
(May 15) or ending date (May 14) of each plan year. The board of directors
may terminate this plan at any time. For 1996, 1995 and 1994, shares
issued under the employee stock ownership plan totaled 131,432, 73,409 and
64,808. At December 28, 1996, shares totaling 911,583 were reserved for
issuance to employees under this plan, and the Corporation held
contributions of approximately $2.0 million for the purchase of common
stock.

Franchised dealers are entitled to participate in a dealer stock ownership
plan. The purchase price of the common stock is the lesser of the mean of
the high and low price of the stock on the beginning date (May 15) or
ending date (May 14) of each plan year. For 1996, 1995 and 1994, shares
issued under the dealer stock ownership plan totaled 117,902, 84,701 and
75,189. At December 28, 1996, 764,663 shares were reserved for issuance to
franchised dealers under this plan, and the Corporation held contributions
of approximately $2.3 million for the purchase of common stock.

Non-employee directors receive a mandatory minimum of 25% and an elective
maximum of up to 100% of their fees and retainer in shares of the
Corporation's stock. Directors may elect to defer receipt of all or part
of these shares. For 1996, 1995 and 1994, shares issued under the
Directors' Fee Plan totaled 3,140, 8,613 and 2,318. Additionally, receipt
of 6,327, 2,588 and 903 shares were deferred in 1996, 1995 and 1994. At
December 28, 1996, 274,330 shares were reserved for issuance to directors
under this plan.

The Corporation adopted Statement of Financial Accounting Standards (SFAS)
No. 123, "Accounting for Stock-Based Compensation," effective January
1996. As permitted, the Corporation continued its current method of
accounting for stock-based compensation plans in accordance with
Accounting Principles Board (APB) Opinion No. 25.

In accordance with SFAS No. 123, the fair value of each option grant was
estimated as of the date of grant using an option pricing model. The
Corporation used the Black-Scholes option pricing model with the following
weighted average assumptions for options granted in 1996 and 1995,
respectively: expected volatility of 21.6% and 21.3%; risk-free interest
rates of 5.7% and 7.5%; dividend yield of 3.1% and 3.3%, and expected
option lives of 6.9 years and 5.7 years. If the Corporation had elected to
recognize compensation cost for stock-based compensation consistent with
the methodology prescribed by SFAS No. 123, net earnings and net earnings
per share for 1996 and for 1995 would not have been materially different
from amounts reported in the Consolidated Statements of Earnings.

1996                1995                1994 
Weighted            Weighted            Weighted
Average             Average             Average
Exercise            Exercise            Exercise
Options   Price    Options    Price    Options    Price
Outstanding at 
beginning 
of period      2,498,742  $ 21.54  2,329,826  $ 20.99  2,847,996  $ 20.84
Granted            72,000    30.52    714,750    21.06     60,750    24.63
Exercised        (370,146)   20.78   (516,044)   18.40   (305,168)   19.52
Canceled         (193,173)   22.56    (29,790)   21.51   (273,752)   21.87
---------  -------  ---------  -------  ---------  -------
Outstanding at
end of 
period         2,007,423  $ 21.90  2,498,742  $ 21.54  2,329,826  $ 20.99
=========  =======  =========  =======  =========  =======
Exercisable at 
end of period  1,792,859  $ 21.88  2,122,736  $ 21.52  2,247,006  $ 20.78
Available for 
grant at end 
of period      3,543,353           1,892,390           2,607,140

The weighted average fair value of options, calculated using the Black-
Scholes option pricing model, granted during the years ended December 28,
1996 and December 30, 1995 were $6.99 and $4.91.  The following table
summarizes information about stock options outstanding as of December 28,
1996:

1996 Options Outstanding                   1996 Options Exercisable

Weighted                    Weighted               Weighted
Range of      Average      Remaining     Average                Average
Exercise      Number      Contractual    Exercise    Number     Exercise
Prices      Outstanding      Life        Price     Exercisable  Price
$ 19 to 23   1,604,663        6.4         $ 21.09   1,417,099    $ 21.11
$ 23 to 27     324,760        3.2           23.88     324,760      23.88
$ 27 to 32      78,000        9.1           30.35      51,000      30.59
---------        ---         -------   ---------    -------
Totals       2,007,423        6.0         $ 21.90   1,792,859    $ 21.88
=========        ===         =======   =========    =======

Note 12 - Capital Stock

In 1996, the Corporation repurchased, on a post-split basis, 615,750
shares of its common stock at an average price 
of $31.12.

In May 1995, the Corporation completed a $100 million Share Repurchase
Program authorized by the board of directors in January 1995. The
Corporation repurchased 4.2 million shares (post-split) under the program
at an average price of $23.83 per share.

The board of directors declared on October 23, 1987 a dividend
distribution of one preferred stock purchase right for each share of the
Corporation's outstanding common stock. As a result of the Corporation's
three-for-two stock split effected in 1996, two-thirds of a right is now
associated with each share of common stock. The rights are exercisable
only if a person or group acquires 15% or more of the Corporation's common
stock ("Acquiring Person") or publicly announces a tender offer to become
an Acquiring Person. Each right may then be exercised to purchase one one-
hundredth of a share of Series A Junior Preferred Stock for $125, but if a
person or group becomes an Acquiring Person, then each right entitles the
holder (other than an Acquiring Person) to acquire common stock of the
Corporation having a market value equivalent to two times the current
purchase price. If the Corporation is acquired in a merger or other
business combination not approved by the board of directors, then each
holder of a right will be entitled to purchase common stock of the
surviving company having a market value equivalent to two times the
current purchase price. The effect of the rights is to cause ownership
dilution to a person or group attempting to acquire the Corporation
without approval of the Corporation's board of directors. The rights
expire on November 3, 1997, and may be redeemed by the Corporation at a
price of $.05 per right at any time prior to 10 days after a person or
group becomes an Acquiring Person.

Note 13 - Commitments and Contingencies

The Corporation has entered into certain operating lease agreements on
facilities and computer equipment, which extend for varying amounts of
time.

The Corporation's lease commitments require future payments as follows:

Year Ending        (Amounts in Thousands)
1997                     $14,793
1998                      11,680
1999                       6,978
2000                       4,542
2001                       3,744
2002 and thereafter       10,707

Rent expenses for worldwide facilities and computer equipment were $18.0
million, $14.4 million and $11.8 million in 1996, 1995 and 1994.

Prior to the disposition of Systems Control, Inc. by a subsidiary of the
Corporation on September 29, 1994, Systems Control, Inc.'s single-purpose
subsidiaries, Tejas Testing Technology One, L.C. and Tejas Testing
Technology Two, L.C. (the "Tejas Companies"), entered into two seven-year
contracts with the Texas Natural Resources Conservation Commission
("TNRCC"), an agency of the State of Texas, to perform automotive
emissions testing in the Dallas/Fort Worth and southeast regions of Texas
in a centralized manner in accordance with the federal Environmental
Protection Agency ("EPA") guidelines relating to "I/M 240" test-only
facilities. The Corporation guaranteed payment (the "Guaranty") of the
Tejas Companies' obligations under an Agreement for Lease and a seven-year
Lease Agreement, each dated June 22, 1994, in the amount of approximately
$98.8 million plus an interest factor (the "Lease Obligations"), pursuant
to which the Tejas Companies leased the facilities (and associated testing
equipment) necessary to perform the emissions-testing contracts. The
Guaranty was assigned to the lessor's lenders (the "Lenders") as
collateral. Pursuant to an Indemnity Agreement entered into as of
September 29, 1994, the Tejas Companies agreed to reimburse the
Corporation for any payments it made under the Guaranty.

The State of Texas subsequently enacted legislation designed to terminate
the centralized testing program described in the emissions-testing
contracts. On September 12, 1995, the Tejas Companies filed bankruptcy
petitions under Chapter 11 of the Bankruptcy Code in the United States
Bankruptcy Court for the Western District of Texas (Austin Division). The
Tejas Companies have commenced litigation in state and federal court
against the TNRCC and related entities to assert their rights with respect
to the emissions-testing contracts, and the Corporation has intervened in
such litigation to protect its interests. State court litigation filed in
the 345th Judicial District Court of Travis County, Texas concluded on
January 28, 1997. A decision has not yet been announced. In addition, the
Corporation is a creditor in the Tejas Companies' bankruptcy proceedings
and will continue to take steps to protect its interests in such
proceedings.

The Corporation believes that it is probable that there will be
developments, prior to the end of the 1997 Texas legislative session
(approximately May 1997) to enable the Lease Obligations to ultimately be
satisfied. The basis for such developments arises under the original
contracts to perform centralized emissions testing. Those contracts
obligate the TNRCC to reimburse costs that the Tejas Companies incurred in
the construction and implementation of the centralized testing program and
have not recovered through the sale of the testing facilities to a third
party. Fulfillment of such obligations requires an appropriation of funds
by the Texas Legislature, which is subject to the political process. The
TNRCC is contractually obligated to seek such appropriation and, in a
letter dated November 21, 1996, the TNRCC affirmed this obligation in a
request to the Texas Legislative Budget Board for an appropriation in the
amount of $89.6 million, exclusive of the $14.3 million estimated by the
TNRCC to be realized from the sale of the testing facilities, resulting in
a total reimbursement of $103.9 million. The Corporation believes the
amount to be realized from the sale of the testing facilities will be
approximately $20 million.

The Corporation and the Lenders have been engaged in continuing
discussions concerning this matter, and they have reached an agreement
whereby the Lenders will forbear until at least June 30, 1997 from
exercising their rights under the terms of the Guaranty to cause the
Corporation to pay all Lease Obligations to the Lenders on an accelerated
basis. The Corporation continues to make advances under the Guaranty of
approximately $1.8 million per month, which have totaled $34.5 million
through December 28, 1996. While the Lenders have agreed to forbear until
at least June 30, 1997, given the delay in resolving this matter and other
factors, the Corporation at June 29, 1996 recognized the remaining net
obligation under the Guaranty, which as of December 28, 1996 is $54.5
million. This is included in Other Long-term Liabilities on the
accompanying Consolidated Balance Sheets. In addition, the Corporation has
recorded as assets the monthly advances and the other amounts expected to
be received from the Tejas Companies under the Indemnity Agreement. These
net receivables total $89.0 million as of December 28, 1996 and are
included in Intangible and Other Assets. Described previously are
mechanisms by which the Tejas Companies may receive funds to enable them
to satisfy their contractual obligation to the Corporation under the
Indemnity Agreement. The Corporation believes that recovery of the net
receivables from the Tejas Companies is probable, and it will make an
ongoing assessment of the likelihood of realization of such receivables.

Note 14 - Reporting Segments

The Corporation operates predominantly in a single industry as a
manufacturer and distributor of tools and equipment for the professional
technician. 

The following table presents information about the Corporation by
geographic area.
United             Other
States    Europe   Non-U.S.  Eliminations Consolidated
Net sales to 
unaffiliated 
customers
1996            $1,055,999  $268,818  $160,462     $       -    $1,485,279
1995               951,912   183,301   156,912             -     1,292,125
1994               862,189   191,648   140,459             -     1,194,296

Transfers between 
geographic areas
1996            $  147,121  $  2,907  $ 25,295     $(175,323)   $        -
1995               140,251     2,478    23,037      (165,766)            -
1994               149,986     2,670     9,793      (162,449)            -

Earnings from 
operations
1996            $  185,532  $ 20,994  $ 15,569     $  (1,569)   $  220,526
1995               169,236     6,201    17,648        (4,441)      188,644
1994               127,893    21,444    14,217        (4,600)      158,954

Identifiable 
assets
1996            $1,179,926  $226,286  $134,730     $ (20,154)   $1,520,788
1995             1,059,516   206,177   121,835       (26,555)    1,360,973
1994             1,015,208   137,340   108,083       (25,726)    1,234,905

Transfers between geographic areas primarily represent intercompany export
sales of U.S.-produced goods and are accounted for based on established
sales prices between the related companies. Export sales to foreign
unaffiliated customers represent less than 10% of consolidated net sales.
In computing earnings from operations for foreign subsidiaries, no
allocations of general corporate expenses, interest or income taxes have
been made.

Management's Responsibility for Financial Reporting

The management of Snap-on Incorporated is responsible for the preparation
and integrity of all financial statements and other information contained
in this Annual Report. The consolidated financial statements have been
prepared in conformity with generally accepted accounting principles and
necessarily include amounts based on judgments and estimates by management
giving due consideration to materiality. The Corporation maintains
internal control systems designed to provide reasonable assurance that the
Corporation's financial records reflect the transactions of the
Corporation and that its assets are protected from loss or unauthorized
use. A staff of internal auditors conducts operational and financial
audits to evaluate the adequacy of internal controls and accounting
practices.

The Corporation's consolidated financial statements have been audited by
Arthur Andersen LLP, independent public accountants, whose report thereon
appears below. As part of their audit of the Corporation's consolidated
financial statements, Arthur Andersen LLP considered the Corporation's
system of internal control to the extent they deemed necessary to
determine the nature, timing and extent of their audit tests. Management
has made available to Arthur Andersen LLP the Corporation's financial
records and related data.

The Audit Committee of the board of directors is responsible for reviewing
and evaluating the overall performance of the Corporation's financial
reporting and accounting practices. The Committee meets periodically and
independently with management, internal auditors and the independent
public accountants to discuss the Corporation's internal accounting
controls, auditing and financial reporting matters. The internal auditors
and independent public accountants have unrestricted access to the Audit
Committee.

Robert A. Cornog                 Donald S. Huml
Chairman, President and          Senior Vice President-
Chief Executive Officer          Finance and Chief
Financial Officer

Report of Independent Public Accountants

To the Board of Directors and Shareholders of Snap-on Incorporated:

We have audited the accompanying consolidated balance sheets of Snap-on
Incorporated (a Delaware Corporation) and subsidiaries as of December 28,
1996 and December 30, 1995, and the related consolidated statements of
earnings, shareholders' equity and cash flows for each of the three years
in the period ended December 28, 1996. These consolidated financial
statements are the responsibility of the Corporation's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the consolidated financial
statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the 
consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial
position of Snap-on Incorporated and subsidiaries as of December 28, 1996
and December 30, 1995, and the consolidated results of their operations
and cash flows for each of the three years in the period ended
December 28, 1996, in conformity with generally accepted accounting
principles.

Arthur Andersen LLP

Chicago, Illinois
January 27, 1997

[Pages 36-37 of Annual Report]

Quarterly Financial Information

Unaudited
(Amounts in thousands except per share data)

1996           1995           1994
Net sales
1st Quarter                   $  344,364     $  309,107     $  298,777
2nd Quarter                      384,554        326,816        298,752
3rd Quarter                      347,202        309,065        278,359
4th Quarter                      409,159        347,137        318,408
----------     ----------     ----------
$1,485,279     $1,292,125     $1,194,296
==========     ==========     ==========
Gross profit
1st Quarter                   $  173,829     $  159,269     $  153,470
2nd Quarter                      194,129        167,247        156,087
3rd Quarter                      176,478        158,039        140,771
4th Quarter                      206,348        178,936        158,509
----------     ----------     ----------
$  750,784     $  663,491     $  608,837
==========     ==========     ==========
Net earnings
1st Quarter                   $   29,650     $   26,460     $   22,834
2nd Quarter                       34,528         29,718         26,099
3rd Quarter                       30,765         26,329         22,706
4th Quarter                       36,508         30,823         26,675
----------     ----------     ----------
$  131,451     $  113,330     $   98,314
==========     ==========     ==========
Earnings per 
common share*
1st Quarter                   $      .49     $      .42     $      .36
2nd Quarter                          .56            .48            .41
3rd Quarter                          .51            .43            .35
4th Quarter                          .60            .51            .41
----------     ----------     ----------
$     2.16     $     1.84     $     1.53
==========     ==========     ==========

* Adjusted for the three-for-two stock split in 1996.

Eleven-Year Data
(Amounts in thousands except share data)

1996          1995          1994           1993           1992           1991

Summary of operations
Net sales                             $ 1,485,279   $ 1,292,125   $ 1,194,296    $ 1,132,010    $   983,800    $   881,591
Gross profit                              750,784       663,491       608,837        595,728        509,413        437,685
Operating expenses                        594,527       538,021       510,361        509,910        457,384        370,708
Net finance income                         64,269        63,174        60,458         61,115         63,646         56,890
Operating income                          220,526       188,644       158,934        146,933        115,675        123,867
Interest expense                           12,649        13,327        10,806         11,198          5,969          5,250
Other income (expense) - net                  776         4,572         5,541            756           (131)           (91)
Pre-tax earnings                          208,653       179,889       153,669        136,491        109,575        118,526
Income taxes                               77,202        66,559        55,355         50,679         43,600         45,300
Net earnings                              131,451       113,330        98,314         85,812         65,975         34,277**

Financial position
Current assets                        $ 1,017,324   $   946,689   $   873,020    $   854,598    $   832,603    $   666,623
Current liabilities                       341,371       336,075       237,869        308,037        317,074        176,650
Working capital                           675,953       610,614       635,151        546,561        515,529        489,973
Accounts receivable                       651,739       610,064       568,378        539,949        508,092        461,596
Inventories                               269,750       250,434       229,037        249,102        216,262        160,148
Property and equipment - net              245,294       220,067       209,142        224,810        226,498        206,481
Total assets                            1,520,788     1,360,973     1,234,905      1,218,933      1,172,413        915,374
Long-term debt                            149,804       143,763       108,980         99,683         93,106          7,179
Shareholders' equity                      828,161       750,732       766,398        701,663        664,665        652,719

Common share summary*
Net earnings per share                $      2.16   $      1.84   $      1.53    $      1.34    $      1.04    $       .55**
Cash dividends paid per share                 .76           .72           .72            .72            .72            .72
Shareholders' equity per share              13.62         12.35         11.91          10.99          10.45          10.31
Average shares outstanding             60,967,865    61,510,500    64,187,874     63,856,175     63,515,672     62,732,652

Other financial statistics
Cash dividends paid                   $    46,323   $    44,113   $    46,197    $    45,942    $    45,718    $    45,086
Dividends paid as a percent
of net earnings                             35.2%         38.9%         47.0%          53.5%          69.3%          61.6%***
Capital expenditures                       52,333        31,581        41,788         33,248         21,081         23,447
Depreciation and amortization              31,879        31,534        29,632         32,131         29,457         25,619
Current ratio                                 3.0           2.8           3.7            2.8            2.6            3.8
Total debt to total capital                 17.3%         18.5%         13.5%          19.3%          19.5%           1.2%
Effective tax rate                          37.0%         37.0%         36.0%          37.1%          39.8%          38.2%
Operating income as a percent of
net sales                                  14.8%         14.6%         13.3%          13.0%          11.8%          14.1%
Net earnings as a percent of net sales       8.9%          8.8%          8.2%           7.6%           6.7%           8.3%***
Return on average
shareholders' equity                       16.7%         14.9%         13.4%          12.6%          10.0%          11.4%***
Common stock price range*             38.25-27.33   31.50-20.67   29.58-19.33    29.67-20.33    26.67-18.00    23.00-18.25

Eleven-Year Data (continued)
(Amounts in thousands except share data)
1990          1989          1988           1987           1986

Summary of operations
Net sales                             $   931,533   $   890,792   $   854,592    $   754,303    $   670,086
Gross profit                              469,149       439,861       431,748        377,167        331,950
Operating expenses                        359,266       320,178       287,712        252,115        230,489
Net finance income                         53,182        47,202        37,991         30,508         25,443
Operating income                          163,065       166,885       182,027        155,560        126,904
Interest expense                            6,762         3,298         2,637          2,788          2,672
Other income (expense) - net                3,557         1,923         3,432          3,024          2,264
Pre-tax earnings                          159,860       165,510       182,822        155,796        126,496
Income taxes                               59,100        60,800        69,500         67,200         61,000
Net earnings                              100,760       104,710       113,322         88,596         65,496

Financial position
Current assets                        $   675,038   $   564,623   $   504,980    $   470,516    $   392,172
Current liabilities                       236,802       179,476       142,337        131,420        112,303
Working capital                           438,236       385,147       362,643        339,096        279,869
Accounts receivable                       459,381       403,926       336,588        277,357        226,551
Inventories                               182,065       137,106       139,460        120,083        124,845
Property and equipment - net              210,414       195,020       146,371        128,082        115,144
Total assets                              907,854       777,603       667,538        615,817        526,580
Long-term debt                              7,275         7,700         8,125         12,622         16,061
Shareholders' equity                      636,403       572,657       505,202        457,536        382,952

Common share summary*
Net earnings per share                $      1.63   $      1.70   $      1.81    $      1.42    $      1.06
Cash dividends paid per share                 .72           .69           .59            .47            .41
Shareholders' equity per share              10.28          9.29          8.23           7.31           6.19
Average shares outstanding             61,811,345    61,558,467    62,404,692     62,287,718     61,753,197

Other financial statistics
Cash dividends paid                   $    44,505   $    42,655   $    36,681    $    29,060    $    25,110
Dividends paid as a percent
of net earnings                            44.2%         40.7%         32.4%          32.8%          38.3%
Capital expenditures                       44,353        72,136        37,949         30,921         32,319
Depreciation and amortization              25,914        21,865        18,699         16,597         14,862
Current ratio                                 2.9           3.1           3.5            3.6            3.5
Total debt to total capital                 11.7%          7.3%          1.7%           3.4%           5.1%

Effective tax rate                          37.0%         36.7%         38.0%          43.1%          48.2%
Operating income as a percent of 
net sales                                   17.5%         18.7%         21.3%          20.6%          18.9%
Net earnings as a percent of net sales      10.8%         11.8%         13.3%          11.7%           9.8%
Return on average
shareholders' equity                       16.7%         19.4%         23.5%          21.1%          18.2%
Common stock price range*             25.33-17.50   27.92-19.25   29.92-21.83    31.00-16.17    21.42-13.58

*    Adjusted for the three-for-two stock split in 1996.
**   Includes the cumulative effect of accounting change related to 
the early adoption of the accounting provisions of the Statement
of Financial Accounting Standards (SFAS) No. 106, "Employers'
Accounting for Postretirement Benefits Other than Pensions." 
Excluding this cumulative effect, 1991 net earnings were $73,226
and earnings per share were $1.17.
***  Based on net earnings before cumulative effect of accounting
change related to adoption of SFAS No. 106.

[Page 40 of Annual Report]

Investor Information

Common Stock High/Low Prices*
Quarter           1996              1995
First          $31.67-28.50      $24.58-20.67
Second          32.92-30.00       26.50-22.42
Third           32.63-27.33       28.17-25.33
Fourth          38.25-31.88       31.50-25.25

Dividends Per Common Share*
Quarter           1996              1995
First            $ .18             $ .18
Second             .18               .18
Third              .20               .18
Fourth             .20               .18
-----             -----
Total            $ .76             $ .72
=====             =====

Exchange Listing
Snap-on Incorporated common stock is listed on the New York Stock
Exchange, Ticker Symbol - SNA.

Transfer Agent and Registrar
Harris Trust and Savings Bank
P.O. Box A3504
Chicago, Illinois  60690-3504
or
311 West Monroe Street
Eleventh Floor
Chicago, Illinois 60606

Shareholder Inquiries
Shareholders with questions may call the Transfer Agent, Harris Trust and
Savings Bank, toll-free at 1-800-524-0687.  The deaf and hearing impaired
can call (312) 461-5633.

Dividend Record and Pay Dates for 1997
Quarter      Record Date      Pay Date
First        February 18      March 10
Second       May 20           June 10
Third        August 20        September 10
Fourth       November 19      December 10

Shareholders
The number of shareholder accounts of record as of December 28, 1996, was
10,556.

Dividend Reinvestment
Snap-on shareholders may increase their investment in the corporation
through a no-commission dividend reinvestment plan. For information, write
to:
Harris Trust and Savings Bank
Dividend Reinvestment Plan Services
P.O. Box A3309
Chicago, Illinois 60690-0735
Or phone: 1-800-524-0687

Form 10-K and Other Financial Publications
These publications are available without charge. Contact the public
relations department at P.O. Box 1410, Kenosha, WI 53141-1410, or call
(414) 656-4808 (recorded message).

Analyst Contact
Securities analysts and other investors seeking information about the
corporation should contact Lynn McHugh, assistant treasurer - investor
relations, (414) 656-6488.

Independent Auditors
Arthur Andersen LLP
33 West Monroe Street
Chicago, Illinois  60603
(312) 580-0033

Annual Meeting
The Annual Meeting of Shareholders will be held at the Racine Marriott,
7111 Washington Avenue, Racine, Wisconsin, at 10:00 a.m. on Friday, 
April 25, 1997.

Corporate Offices
P.O. Box 1430
Kenosha, Wisconsin 53141-1430
Phone (414) 656-5200

* Adjusted for the three-for-two stock split in 1996.

Exhibit (21)

SUBSIDIARIES OF THE CORPORATION

State or other jurisdiction
Name                                    of organization 

Consolidated Devices, Inc.              California
Edge Diagnostic Systems                 California
Herramientas Eurotools, S.A.            Spain
John Bean Company                       Wisconsin
Sioux Tools, Inc.                       Iowa
Snap-on Credit Corporation              Wisconsin
Snap-on Financial Services, Inc.        Nevada
Snap-on Global Holdings, Inc.           Delaware
Snap-on Technologies, Inc.              Illinois
Snap-on Tools (Australia) Pty. Ltd.     Australia
Snap-on Tools Company                   Wisconsin
Snap-on Tools International, Ltd.       Virgin Islands
Snap-on Tools Japan, K.K.               Japan
Snap-on Tools Limited                   United Kingdom
Snap-on Tools of Canada Ltd.            Canada
Sun Electric Deutschland GmbH           Germany
Sun Electric do Brazil                  Brazil
Sun Electric Europe B.V.                Netherlands
Sun Electric Nederland B.V.             Netherlands
Sun Electric U.K. Limited               England
Wheeltronic Ltd.                        Ontario

<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF SNAP-ON INCORPORATED AS OF AND FOR
THE YEAR ENDED DECEMBER 28, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000

<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-28-1996
<PERIOD-START>                             DEC-31-1995
<PERIOD-END>                               DEC-28-1996
<CASH>                                          15,350
<SECURITIES>                                         0
<RECEIVABLES>                                  668,642
<ALLOWANCES>                                    16,903
<INVENTORY>                                    269,750
<CURRENT-ASSETS>                             1,017,324
<PP                                         510,239
<DEPRECIATION>                                 264,945
<TOTAL-ASSETS>                               1,520,788
<CURRENT-LIABILITIES>                          341,371
<BONDS>                                        149,804
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                        65,972
<OTHER-SE>                                     762,189
<TOTAL-LIABILITY-AND-EQUITY>                 1,520,788
<SALES>                                      1,485,279
<TOTAL-REVENUES>                             1,485,279
<CGS>                                          734,495
<TOTAL-COSTS>                                  734,495
<OTHER-EXPENSES>                               594,527
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                              12,649
<INCOME-PRETAX>                                208,653
<INCOME-TAX>                                    77,202
<INCOME-CONTINUING>                            131,451
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                   131,451
<EPS-PRIMARY>                                     2.16
<EPS-DILUTED>                                     2.16