What changed in this filing

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Item 9A. Controls and Procedures

2022-02-11 compared with 2021-02-11 · 300 added, 369 removed, 1924 unchanged (26% of the section changed)

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Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our internal control over financial reporting based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013) .

The company’s February 26, 2021, acquisition of Dealer-FX Group, Inc.

(which represented 3% of total assets at January 1, 2022, and 0.9% of 2021 net sales) was excluded from the scope of management’s assessment of internal control over financial reporting as of January 1, 2022.

Based on this assessment, the company’s management believes that, as of January 1, 2022, our internal control over financial reporting was effective at a reasonable assurance level.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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

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

Opinion on Internal Control over Financial Reporting

12 unchanged sentences

We believe that our audit provides a reasonable basis for our opinion.

As described in Management’s Report on Internal Control over Financial Reporting, management excluded from its assessment the internal control over financial reporting at Dealer-FX Group, Inc.

(“Dealer-FX”), which was acquired on February 26, 2021, and whose financial statements represents 3% of total assets and 0.9% of net sales of the consolidated financial statement amounts as of and for the year ended January 1, 2022.

Accordingly, our audit did not include the internal control over financial reporting at Dealer-FX.

Definition and Limitations of Internal Control over Financial Reporting

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Other Information

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable

Directors, Executive Officers and Corporate Governance

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Pinchuk serves on the board of directors of Columbus McKinnon Corporation.

Pinchuk served as an officer of the U.S.

Army in Vietnam.

Pagliari (67) – Senior Vice President – Finance and Chief Financial Officer since 2010.

Arregui (55) – Senior Vice President and President – Commercial Group since 2019, President, SNA Europe from 2015 to 2019, and Vice President, SNA Europe Operations from 2008 to 2015.

Banerjee (70) – Senior Vice President, Human Resources and Chief Development Officer since 2015, and President, Commercial Group from 2011 to 2015.

Arregui (56) – Senior Vice President and President – Commercial Group since 2019.

President of SNA Europe from 2015 to 2019.

Banerjee (71) – Senior Vice President – Human Resources and Chief Development Officer since 2015.

Iain Boyd (59) – Vice President – Operations Development since 2015.

Vice President, Human Resources from 2007 to 2015.

Chambers (56) – Senior Vice President and President – Snap-on Tools Group since 2019, President, Commercial Group from 2015 to 2019 and President, Equipment from 2014 to 2015.

Chambers (57) – Senior Vice President and President – Snap-on Tools Group since 2019.

President of Commercial Group from 2015 to 2019.

Lemerand (59) – Vice President and Chief Information Officer since 2017.

Vice President of Information Technology Services from 2015 to 2017, and Senior Director, Information Technology Sales and Marketing Applications from 2005 to 2015.

Vice President of Information Technology Services from 2015 to 2017.

Miller (51) – Vice President, General Counsel and Secretary since 2018.

Associate General Counsel from 2012 to 2018.

Strege (63) – Vice President and Controller since 2017.

Vice President, Internal Audit, Controls and Compliance from 2007 to 2017.

Ozolins (50) – Vice President and Controller since 2021.

Vice President, and formerly Director, of Internal Audit from 2016 to 2021.

Ward (69) – Senior Vice President and President – Repair Systems & Information Group since 2010.

There is no family relationship among the executive officers and there has been no involvement in legal proceedings during the past ten years that would be material to the evaluation of the ability or integrity of any of the executive officers.

Snap-on’s executive officers include a woman, a veteran of the U.S.

Army, and two executives who are ethnically diverse.

Additionally, there is no family relationship among the executive officers and there has been no involvement in legal proceedings during the past ten years that would be material to the evaluation of the ability or integrity of any of the executive officers.

Executive officers may either be elected by the Board or may be appointed by the Chief Executive Officer at the regular meeting of the Board that follows the Annual Shareholders’ Meeting, which is ordinarily held in April each year, or at such other times as new positions are created or vacancies must be filled.

2021 ANNUAL REPORT 55

Code of Ethics and Website Disclosure

Snap-on has adopted a written code of ethics that applies to its Chief Executive Officer, Chief Financial Officer, Vice President and Controller, and all other financial officers and executives performing similar functions.

Snap-on has posted a copy of the code of ethics in the Investors/Corporate Governance section on the company’s website at www.snapon.com .

Snap-on has posted a copy of the code of ethics in the “Investors” section on the company’s website at www.snapon.com .

Snap-on will also post any amendments to these documents, or information about any waivers granted to directors or executive officers with respect to the Code of Business Conduct and Ethics, on the company’s website at www.snapon.com .

Snap-on intends to satisfy the disclosure requirements under Item 10 of Form 8-K regarding amendments to, or waivers from, the code of ethics by posting such information in the “Investors” section of its corporate website at www.snapon.com .

2020 ANNUAL REPORT 55

Executive Compensation

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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by Item 12 is contained in Snap-on’s 2021 Proxy Statement in the sections entitled “Executive Compensation,” “Security Ownership of Certain Beneficial Owners and Management,” “Other Information” and “Item 4:

Approval of the Amendment to, and Restatement of, the Snap-on Incorporated 2011 Incentive Stock and Awards Plan,” and is incorporated herein by reference.

The following table sets forth information about Snap-on’s equity compensation plans at 2021 year end:

Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) Weighted-average exercise price of outstanding options, warrants and rights (b) Number securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)

Equity compensation plans approved by security holders 2,874,019 (1)

4,430,957 (3)

Equity compensation plans not approved by security holders 54,920 (4)

Not Applicable - (5)

Total 2,928,939 $152.55 (2)

4,430,957 (5)

(1) Includes (i) options and stock appreciation rights (“SARs”) to acquire 2,828,710 shares granted under the 2011 Incentive Stock and Awards Plan (the “2011 Plan”);

(ii) 32,265 shares represented by time-based restricted stock units granted under the 2011 Plan;

and (iii) 13,044 shares represented by deferred share units under the Directors’ Fee Plan.

Excludes 229,106 shares issuable in connection with the vesting of performance share awards under the 2011 Plan.

Also excludes shares of common stock that may be issuable under the employee and franchisee stock purchase plans.

(2) Reflects only the weighted-average exercise price of outstanding stock options and SARs granted under the 2011 Plan and does not include shares represented by deferred share units under the Directors’ Fee Plan and shares issuable in connection with the vesting of restricted stock units or performance units under the 2011 Plan for which there are no exercise prices.

Also excludes shares of common stock that may be issuable under the employee and franchisee stock purchase plans.

(3) Includes (i) 3,643,845 shares reserved for issuance under the 2011 Plan;

(ii) 189,837 shares reserved for issuance under the Directors’ Fee Plan;

and (iii) 597,275 shares reserved for issuance under the employee stock purchase plan.

(4) Consists of deferred share units under Snap-on’s Deferred Compensation Plan, which allows elected and appointed officers of Snap-on to defer all or a percentage of their respective annual salary and/or incentive compensation.

The deferred share units are payable in shares of Snap-on common stock on a one-for-one basis and are calculated at fair market value.

Shares of common stock delivered under the Deferred Compensation Plan are previously issued shares reacquired and held by Snap-on.

(5) The Deferred Compensation Plan provides that Snap-on will make available, as and when required, a sufficient number of shares of common stock to meet the needs of the plan.

It further provides that such shares shall be previously issued shares reacquired and held by Snap-on.

The additional information required by Item 12 is contained in Snap-on’s 2022 Proxy Statement in the sections entitled “Executive Compensation,” “Security Ownership of Certain Beneficial Owners and Management,” and “Other Information,” and is incorporated herein by reference.

Certain Relationships and Related Transactions, and Director Independence

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Incorporated by reference to the section entitled “Deloitte & Touche LLP Fee Disclosure” in Snap-on’s 2022 Proxy Statement.

SNAP-ON INCORPORATED

Exhibits, Financial Statement Schedules

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Unless otherwise indicated, references to “fiscal 2021” or “2021” refer to the fiscal year ended January 1, 2022;

references to “fiscal 2019” or “2019” refer to the fiscal year ended December 28, 2019;

references to “fiscal 2020” or “2020” refer to the fiscal year ended January 2, 2021;

and references to “fiscal 2019” or “2019” refer to the fiscal year ended December 28, 2019.

References to 2020, 2019 and 2018 year end refer to January 2, 2021, December 28, 2019, and December 29, 2018, respectively.

References to 2021, 2020 and 2019 year end refer to January 1, 2022, January 2, 2021, and December 28, 2019, respectively.

The following consolidated financial statements of Snap-on and the Report of Independent Registered Public Accounting Firm thereon, are filed as part of this report:

• Report of Independent Registered Public Accounting Firm.

• Report of Independent Registered Public Accounting Firm (PCAOB ID No.

• Consolidated Statements of Earnings for the 2021, 2020 and 2019 fiscal years.

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All schedules are omitted because they are not applicable, or the required information is included in the consolidated financial statements or notes thereto.

SNAP-ON INCORPORATED

List of Exhibits (*)

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Bank National Association as trustee (incorporated by reference to Exhibit (4)(b) to Form S-3 Registration Statement (Registration No.

(b) Officer’s Certificate, dated as of August 14, 2009, providing for the $250,000,000 6.125% Notes due 2021 (the “2021 Notes”) (incorporated by reference to Exhibit 4.1 to Snap-on’s Current Report on Form 8-K dated August 11, 2009 (Commission File No.

(b) Officer’s Certificate, dated as of February 21, 2017, providing for the $300,000,000 3.25% Notes due 2027 (the “2027 Notes”) (incorporated by reference to Exhibit 4.2 to Snap-on’s Current Report on Form 8-K dated February 15, 2017 (Commission File No.

(c) Officer’s Certificate, dated as of February 26, 2018, providing for the $400,000,000 4.10% Notes due 2048 (the “2048 Notes”) (incorporated by reference to Exhibit 4.2 to Snap-on’s Current Report on Form 8-K dated February 20, 2018 (Commission File No.

(d) Officer’s Certificate, dated as of February 26, 2018, providing for the $400,000,000 4.10% Notes due 2048 (the “2048 Notes”) (incorporated by reference to Exhibit 4.2 to Snap-on’s Current Report on Form 8-K dated February 20, 2018 (Commission File No.

(e) Officer’s Certificate, dated as of April 30, 2020, providing for the $500,000,000 3.10% Notes due 2050 (the “2050 Notes”) (incorporated by reference to Exhibit 4.2 to Snap‑on’s Current Report on Form 8‑K dated April 27, 2020 (Commission File No.

(f) Description of Securities

(f)(1) Description of Common Stock (incorporated by reference to Exhibit 4(e)(1) to Snap‑on ’ s Annual Report on Form 10 ‑K for the fiscal year ended December 28, 2019 (Commission File No.

(f)(2) Description of 2021 Notes (incorporated by reference to Exhibit 4(e)( 2 ) to Snap‑on ’ s Annual Report on Form 10‑K for the fiscal year ended December 28, 2019 (Commission File No.

(f)(3) Description of 2027 Notes (incorporated by reference to Exhibit 4(e)( 3 ) to Snap‑on ’ s Annual Report on Form 10‑K for the fiscal year ended December 28, 2019 (Commission File No.

(f)(4) Description of 2048 Notes (incorporated by reference to Exhibit 4(e)( 4 ) to Snap‑on ’ s Annual Report on Form 10‑K for the fiscal year ended December 28, 2019 (Commission File No.

(f)(5) Description of 2050 Notes

(d) Officer’s Certificate, dated as of April 30, 2020, providing for the $500,000,000 3.10% Notes due 2050 (the “2050 Notes”) (incorporated by reference to Exhibit 4.2 to Snap‑on’s Current Report on Form 8‑K dated April 27, 2020 (Commission File No.

(e) Description of Securities

(e)(1) Description of Common Stock (incorporated by reference to Exhibit 4(e)(1) to Snap‑on’s Annual Report on Form 10‑K for the fiscal year ended December 28, 2019 (Commission File No.

(e)(2) Description of 2027 Notes (incorporated by reference to Exhibit 4(e)(3) to Snap‑on’s Annual Report on Form 10‑K for the fiscal year ended December 28, 2019 (Commission File No.

(e)(3) Description of 2048 Notes (incorporated by reference to Exhibit 4(e)(4) to Snap‑on’s Annual Report on Form 10‑K for the fiscal year ended December 28, 2019 (Commission File No.

(e)(4) Description of 2050 Notes (incorporated by reference to Exhibit 4(f)(5) to Snap‑on’s Annual Report on Form 10‑K for the fiscal year ended January 2, 2021 (Commission File No.

2021 ANNUAL REPORT 57

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1-7724))** (superseded except as to outstanding awards)

(b) Snap-on Incorporated 2011 Incentive Stock and Awards Plan (As Amended and Restated) (incorporated by reference to Exhibit 10(b) to Snap-on’s Annual Report on Form 10-K for the fiscal year ended December 30, 2017 (Commission File No.

(b) Snap-on Incorporated 2011 Incentive Stock and Awards Plan (As Amended and Restated) (incorporated by reference to Exhibit 10.1 to Snap-on’s Current Report on Form 8-K dated April 29, 2021 (Commission File No.

(c) Form of Restated Executive Agreement between Snap-on Incorporated and each of its executive officers** (incorporated by reference to Exhibit 10(c) to Snap-on’s Annual Report on Form 10-K for the fiscal year ended December 30, 2017 (Commission File No.

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(g) Snap-on Incorporated Supplemental Retirement Plan for Officers (as amended through June 11, 2010) (incorporated by reference to Exhibit 10.2 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2010 (Commission File No.

(h) Form of Non-Qualified Stock Option Agreement under the 2001 Incentive Stock and Awards Plan (and accompanying Non-Qualified Stock Option Grant Offer Letter) (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2007 (Commission File No.

1-7724))** (superseded except as to outstanding awards)

(i) Form of Restricted Stock Unit Agreement for Directors under the 2001 Incentive Stock and Awards Plan (and accompanying Restricted Stock Unit Offer Letter) (incorporated by reference to Exhibit 10.2 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended October 3, 2009 (Commission File No.

(h) Form of Restricted Stock Unit Agreement for Directors under the 2001 Incentive Stock and Awards Plan (and accompanying Restricted Stock Unit Offer Letter) (incorporated by reference to Exhibit 10.2 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended October 3, 2009 (Commission File No.

1-7724))** (superseded except as to outstanding awards)

(j) Form of Non-Qualified Stock Option Agreement under the 2011 Incentive Stock and Awards Plan (and accompanying Non-Qualified Stock Option Grant Offer Letter) (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended October 1, 2011 (Commission File No.

(k) Form of Performance Share Unit Award Agreement under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012 (Commission File No.

(l) Form of Restricted Unit Award Agreement for Executive Officers under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012 (Commission File No.

(i) Form of Non-Qualified Stock Option Agreement under the 2011 Incentive Stock and Awards Plan (and accompanying Non-Qualified Stock Option Grant Offer Letter) (incorporated by reference to Exhibit 10.1 to Snap‑on’s Quarterly Report on Form 10-Q for the quarterly period ended October 1, 2011 (Commission File No.

(j) Form of Performance Share Unit Award Agreement under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012 (Commission File No.

(k) Form of Performance-Based Restricted Unit Award Agreement for Executive Officers under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012 (Commission File No.

(l) Form of Restricted Unit Award Agreement for Directors under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012 (Commission File No.

SNAP-ON INCORPORATED

(m) Form of Restricted Unit Award Agreement for Directors under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012 (Commission File No.

(n) Form of Restricted Stock Award Agreement for Directors under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 30, 2013 (Commission File No.

(o) Form of Restricted Stock Unit Award Agreement for Executive Officers and Key Employees under the 2011 Incentive Stock and Awards Plan (form of award agreement consistent with the terms of the 2011 Incentive Stock and Awards Plan) **

(p) Third Amended and Restated Five Year Credit Agreement, dated as of September 16, 2019, among Snap-on Incorporated and the lenders and agents listed on the signature pages thereof, and JPMorgan Chase Bank, N.A., Citibank N.A.

(m) Form of Restricted Stock Award Agreement for Directors under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10.1 to Snap-on’s Quarterly Report on Form 10-Q for the quarterly period ended March 30, 2013 (Commission File No.

(n) Form of Restricted Stock Unit Award Agreement for Executive Officers and Key Employees under the 2011 Incentive Stock and Awards Plan (incorporated by reference to Exhibit 10(o) to Snap-on's Annual Report on Form 10-K for the fiscal year ended January 2, 2021 Commission File No.

(o) Third Amended and Restated Five Year Credit Agreement, dated as of September 16, 2019, among Snap-on Incorporated and the lenders and agents listed on the signature pages thereof, and JPMorgan Chase Bank, N.A., Citibank N.A.

Bank National Association as joint lead arrangers and joint bookrunners (incorporated by reference to Exhibit 10.1 to Snap-on’s Current Report on Form 8-K dated September 16, 2019 (Commission File No.

(q) Underwriting Agreement, dated as of April 27, 2020, among Snap-on Incorporated, Citigroup Global Markets Inc., J.P.

Morgan Securities LLC and U.S.

Bancorp Investments, Inc., as representatives of the several underwriters named therein (incorporated by reference to Exhibit 1.1 to Snap-on’s Current Report on Form 8-K dated April 27, 2020 (Commission File No.

(14) Snap-on Incorporated Section 406 of the Sarbanes-Oxley Act Code of Ethics (incorporated by reference to Exhibit 10(aa) to Snap-on’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (Commission File No.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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

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

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Snap-on Incorporated and subsidiaries (the “Company”) as of January 2, 2021, and December 28, 2019, and the related consolidated statements of earnings, comprehensive income, equity, and cash flows for each of the three years in the period ended January 2, 2021, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of January 2, 2021, and December 28, 2019, and the results of its operations and its cash flows for each of the three years in the period ended January 2, 2021, in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying consolidated balance sheets of Snap-on Incorporated and subsidiaries (the “Company”) as of January 1, 2022, and January 2, 2021, and the related consolidated statements of earnings, comprehensive income, equity, and cash flows for each of the three years in the period ended January 1, 2022, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of January 1, 2022, and January 2, 2021, and the results of its operations and its cash flows for each of the three years in the period ended January 1, 2022, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of January 1, 2022, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 10, 2022, expressed an unqualified opinion on the Company’s internal control over financial reporting.

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2016-13, Financial Instruments – Credit Losses (Topic 326) under the modified retrospective adoption method.

The Company changed its method of accounting for leases in the year ended December 28, 2019 due to the adoption of Accounting Standard Update No.

2016-02, Leases (Topic 842) under the modified retrospective adoption method.

Basis for Opinion

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The Company’s finance receivables are comprised of extended-term installment payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools, diagnostics, and equipment products on an extended-term payment plan, generally with average payment terms of approximately four years.

The receivables are generally secured by the underlying tools and/or diagnostic or equipment products financed.

The receivables are generally secured by the underlying tools, diagnostics and/or equipment products financed.

At January 1, 2022, these loans totaled $1,723.6 million with an allowance of $67.3 million recorded against the receivables.

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• We tested the completeness and accuracy and evaluated the relevance of the key data used as inputs in management’s allowance for credit losses calculation, including loan balances, recoveries, charge-offs, portfolio characteristics and other data.

• We tested the mathematical accuracy of the allowance for credit losses calculation with the assistance of our credit specialists and developed an expectation of the allowance for credit losses and compared it to the recorded balance.

• We tested the mathematical accuracy of the allowance for credit losses calculation and developed an expectation of the allowance for credit losses and compared it to the recorded balance.

• We performed a retrospective review based on net losses as compared to estimates in the Company’s allowance to highlight any inconsistencies.

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Foreign currency translation ( 69.4 ) 112.7 ( 9.5 )

Reclassification of foreign currency translation loss from sale of equity interest to net earnings ( 1.0 ) — —

Unrealized cash flow hedges, net of tax:

Other comprehensive income (loss) before reclassifications

1.4 — ( 0.8 )

Other comprehensive income before reclassifications

Reclassification of cash flow hedges to net earnings ( 1.6 ) ( 1.6 ) ( 1.5 )

Defined benefit pension and postretirement plans:

Net prior service costs and credits and unrecognized (loss) gain

Net prior service costs and credits and unrecognized gain (loss)

85.1 3.8 ( 6.7 )

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Comprehensive income attributable to Snap-on Incorporated $ 842.4 $ 769.1 $ 693.7

* There is no reclassification adjustment as there was no sale or liquidation of any foreign entity during any period presented.

See Notes to Consolidated Financial Statements.

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Balance at December 29, 2018 $ 67.4 $ 359.4 $ 4,257.6 $ ( 462.2 ) $ ( 1,123.4 ) $ 19.8 $ 3,118.6

Impact of the Tax Act on Accumulated Other Comprehensive Income (ASU No.

— — 45.9 ( 45.9 ) — — —

Balance at December 30, 2018 67.4 359.4 4,303.5 ( 508.1 ) ( 1,123.4 ) 19.8 3,118.6

Net earnings for 2019

— — 693.5 — — 17.7 711.2

Other comprehensive loss — — — ( 133.2 ) — — ( 133.2 )

Other comprehensive income — — — 0.2 — — 0.2

Cash dividends – $ 3.93 per share

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Balance at December 28, 2019 67.4 379.1 4,779.7 ( 507.9 ) ( 1,309.2 ) 21.7 3,430.8

Impact of the Tax Act on Accumulated Other Comprehensive Income (ASU No.

Impact of the Credit Loss Standard (ASU No.

2016-13) — — ( 6.1 ) — — — ( 6.1 )

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Other — — ( 0.4 ) — — ( 19.4 ) ( 19.8 )

Balance at December 28, 2019 67.4 379.1 4,779.7 ( 507.9 ) ( 1,309.2 ) 21.7 3,430.8

Impact of adopting the Credit Loss Standard (ASU No.

2016-13) — — ( 6.1 ) — — — ( 6.1 )

Balance at December 29, 2019 67.4 379.1 4,773.6 ( 507.9 ) ( 1,309.2 ) 21.7 3,424.7

Balance at January 2, 2021 67.4 391.7 5,156.9 ( 365.8 ) ( 1,425.3 ) 21.7 3,846.6

Net earnings for 2021

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Settlement of treasury lock — 1.4 —

Loss on early extinguishment of debt — — 7.8

Changes in operating assets and liabilities, net of effects of acquisitions:

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Repayments of long-term debt ( 250.0 ) — —

Repayments of notes payable — — ( 16.8 )

Net increase (decrease) in other short-term borrowings 3.3 ( 187.2 ) 17.6

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Effect of exchange rate changes on cash and cash equivalents ( 0.8 ) 2.4 0.5

Increase in cash and cash equivalents 738.9 43.6 48.9

Increase (decrease) in cash and cash equivalents ( 143.4 ) 738.9 43.6

Cash and cash equivalents at beginning of year 923.4 184.5 140.9

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The Consolidated Financial Statements include the accounts of Snap‑on Incorporated and its wholly-owned and majority-owned subsidiaries (collectively, “Snap-on” or “the company”).

Snap-on accounts for investments in unconsolidated affiliates where Snap-on has a non-significant ownership interest under the equity method of accounting.

Investments in unconsolidated affiliates of $ 21.0 million as of January 2, 2021, and $ 18.8 million as of December 28, 2019, are included in “Other assets” on the accompanying Consolidated Balance Sheets;

no equity investment dividends were received in any period presented.

In the normal course of business, the company may purchase products or services from, or sell products or services to, unconsolidated affiliates.

Purchases from unconsolidated affiliates were $ 9.3 million, $ 10.4 million and $ 11.2 million in 2020, 2019 and 2018, respectively, and sales to unconsolidated affiliates were $ 0.5 million in 2020, $ 0.6 million in 2019 and $ 0.8 million in 2018.

The Consolidated Financial Statements do not include the accounts of the company’s independent franchisees.

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Intercompany accounts and transactions have been eliminated.

Snap-on accounts for investments in unconsolidated affiliates where the company has a non-significant ownership interest under the equity method of accounting.

An investment in an unconsolidated affiliate of $ 21.8 million as of July 1, 2021, was exchanged for 100 % ownership of a wholly owned subsidiary of the unconsolidated affiliate.

Investments in unconsolidated affiliates of $ 21.0 million as of January 2, 2021, are included in “Other assets” on the accompanying Consolidated Balance Sheets;

no equity investment dividends were received in any period presented.

See Note 3 for further information on acquisitions.

In the normal course of business, the company may purchase products or services from, or sell products or services to, unconsolidated affiliates.

Purchases from unconsolidated affiliates were $ 7.7 million, $ 9.3 million and $ 10.4 million in 2021, 2020 and 2019, respectively, and sales to unconsolidated affiliates were $ 0.6 million in 2021, $ 0.5 million in 2020 and $ 0.6 million in 2019.

Fiscal year accounting period:

Snap-on’s fiscal year ends on the Saturday that is on or nearest to December 31.

The 2020 fiscal year ended on January 2, 2021 (“2020”).

The 2019 fiscal year ended on December 28, 2019 (“2019”).

The 2018 fiscal year ended on December 29, 2018 (“2018”).

The 2020 fiscal year contained 53 weeks of operating results, with the additional week occurring in the fourth quarter.

The 2021 fiscal year ended on January 1, 2022 (“2021”) and contained 52 weeks of operating results.

The 2020 fiscal year ended on January 2, 2021 (“2020”) and contained 53 weeks of operating results, with the additional week occurring in the fourth quarter;

the impact of the additional week of operations was not material to Snap-on’s 2020 total revenues or net earnings.

The 2019 and 2018 fiscal years each contained 52 weeks of operating results.

The 2019 fiscal year ended on December 28, 2019 (“2019”) and contained 52 weeks of operating results.

Use of estimates:

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Revenue recognition:

Snap-on recognizes revenue from the sale of tools, diagnostic and equipment products and related services based on when control of the product passes to the customer or the service is provided and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services.

Snap-on recognizes revenue from the sale of tools, diagnostics, and equipment products and related services based on when control of the product passes to the customer or the service is provided and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services.

See Note 2 for information on revenue recognition.

1 unchanged sentence

Snap-on generates revenue from various financing programs that include:

(i) installment sales and lease contracts arising from franchisees’ customers and Snap-on customers who require financing for the purchase or lease of tools and diagnostic and equipment products on an extended-term payment plan;

(i) installment sales and lease contracts arising from franchisees’ customers and Snap-on customers who require financing for the purchase or lease of tools, diagnostics, and equipment products on an extended-term payment plan;

and (ii) business and vehicle loans and leases to franchisees.

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Foreign exchange transaction gains and losses are reported in “Other income (expense) – net” on the accompanying Consolidated Statements of Earnings.

SNAP-ON INCORPORATED

Income taxes:

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Accrued interest and penalties are included within the related tax asset or liability on the accompanying Consolidated Balance Sheets.

SNAP-ON INCORPORATED

Deferred income taxes are provided for temporary differences arising from differences in bases of assets and liabilities for tax and financial reporting purposes.

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The dilutive effect of the potential exercise of outstanding options and stock-settled stock appreciation rights (“SARs”) to purchase common shares is calculated using the treasury stock method.

As of January 1, 2022, there were no awards outstanding that were anti-dilutive;

as of January 2, 2021, there were 2,207,411 awards outstanding that were anti-dilutive;

as of December 28, 2019, there were 1,215,695 awards outstanding that were anti-dilutive;

and as of December 28, 2019 there were 1,215,695 awards outstanding that were anti-dilutive.

17 unchanged sentences

Snap-on considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

Cash and cash equivalents consisted of investments in money market funds and bank deposits at January 2, 2021.

There were no cash equivalents as of December 28, 2019.

2020 ANNUAL REPORT 69

Notes to Consolidated Financial Statements (continued)

Cash and cash equivalents consisted of investments in money market funds and bank deposits at January 1, 2022 and January 2, 2021.

Receivables and allowances for credit losses:

8 unchanged sentences

The allowances take into consideration numerous quantitative and qualitative factors that include receivable type, historical loss experience, delinquency trends, collection experience, current economic conditions, supportable forecasts, when appropriate, and credit risk characteristics.

2021 ANNUAL REPORT 69

Notes to Consolidated Financial Statements (continued)

Snap-on evaluates the credit risk of the customer when extending credit based on a combination of various financial and qualitative factors that may affect its customers’ ability to pay.

3 unchanged sentences

These reviews allow for the formulation of collection strategies and potential collection policy modifications in response to changing risk profiles in the finance and contract receivable portfolios.

A receivable may have credit losses when it is expected that all amounts related to the receivable will not be collected according to the contractual terms of the agreement.

Amounts determined to be uncollectable are charged directly against the allowances, while amounts recovered on previously written-off accounts increase the allowances.

For both finance and contract receivables, net write-offs include the principal amount of losses written off as well as written-off interest and fees, and recourse from franchisees on finance receivables.

Recovered interest and fees previously written off are recorded through the allowances for credit losses and increase the allowance.

A receivable generally has credit losses when it is expected that all amounts related to the receivable will not be collected according to the contractual terms of the agreement.

Amounts determined to be uncollectable are charged directly against the allowance, while amounts recovered on previously written-off accounts increase the allowance.

For both finance and contract receivables, net write-offs include the principal amount of losses written off as well as written-off accrued interest and fees, and recourse from franchisees on finance receivables.

Recovered interest and fees previously written off are recorded through the allowance for credit losses and increase the allowance.

Finance receivables are assessed for write-off when an account becomes 120 days past due and are written off typically within 60 days of asset repossession.

6 unchanged sentences

See Note 4 for further information on receivables and allowances for credit losses.

SNAP-ON INCORPORATED

Other accrued liabilities:

17 unchanged sentences

Should actual product marketability and raw material fitness for use be affected by conditions that are different from management estimates, further adjustments to inventory allowances may be required.

SNAP-ON INCORPORATED

Snap-on adopted the “last-in, first-out” (“LIFO”) inventory valuation method in 1973 for its U.S.

10 unchanged sentences

Capitalized software included in property and equipment reflects costs related to internally developed or purchased software for internal use and is amortized on a straight-line basis over their estimated useful lives.

Long-lived assets are evaluated for impairment when events or circumstances indicate that the carrying amount of the long-lived asset may not be recoverable.

Long-lived assets, including operating lease right-of-use assets, are evaluated for impairment when events or circumstances indicate that the carrying amount of the long-lived asset may not be recoverable.

See Note 6 for further information on property and equipment.

6 unchanged sentences

See Note 7 for further information on goodwill and other intangible assets.

2020 ANNUAL REPORT 71

Notes to Consolidated Financial Statements (continued)

New accounting standards

The following new accounting pronouncements were adopted in fiscal year 2020:

On December 29, 2019, the beginning of Snap-on’s 2020 fiscal year, the company adopted ASU No.

2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement , which is designed to improve the effectiveness of disclosures by removing, modifying and adding disclosures related to fair value measurements.

The adoption of this ASU did not have an impact on the company’s Consolidated Financial Statements or disclosures.

On December 29, 2019, the beginning of Snap-on’s 2020 fiscal year, the company adopted ASU No.

2016-13, Financial Instruments - Credit Losses (Topic 326) , which requires the measurement of expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts.

The main objective of this ASU is to provide financial statement users with more information about the expected credit losses over the contractual life of financial instruments and other commitments to extend credit held by a reporting entity at each reporting date.

Snap-on adopted ASU No.

2016-13 under the modified retrospective approach for receivables measured at amortized costs with prior periods reported in accordance with previously applicable guidance.

See Note 4 for a discussion about the impact the adoption of this ASU had on the company and further information on credit losses.

The following new accounting pronouncement will be adopted in fiscal year 2021:

In December 2019, the FASB issued ASU No.

On January 3, 2021, the beginning of Snap-on’s 2021 fiscal year, the company adopted ASU No.

2019-12, Simplifying the Accounting for Income Taxes , which is designed to simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740.

2019-12 is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

The adoption of this ASU is not expected to have a significant impact on the company’s consolidated financial statements.

The adoption of this ASU did not have a significant impact on the company’s Consolidated Financial Statements.

Revenue Recognition

Snap-on recognizes revenue from the sale of tools, diagnostics, equipment, and related services based on when control of the product passes to the customer or the service is provided and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services.

Revenue disaggregation

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Intersegment amounts are eliminated to arrive at Snap-on’s consolidated financial results.

SNAP-ON INCORPORATED

2021 ANNUAL REPORT 71

Notes to Consolidated Financial Statements (continued)

The following table represents external net sales disaggregated by geography, based on the customers’ billing addresses:

22 unchanged sentences

* North America is comprised of the United States, Canada and Mexico.

2020 ANNUAL REPORT 73

Notes to Consolidated Financial Statements (continued)

SNAP-ON INCORPORATED

The following table represents external net sales disaggregated by customer type:

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The tools product category includes hand tools, power tools, tool storage products and other similar products.

The diagnostics, information and management systems product category includes handheld and PC-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, original equipment manufacturer (“OEM”) purchasing facilitation services, and warranty management systems and analytics to help OEM dealership service and repair shops (“OEM dealerships”) manage and track performance.

The diagnostics, information and management systems product category includes handheld and computer-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, original equipment manufacturer (“OEM”) purchasing facilitation services, and warranty management systems and analytics to help OEM dealership service and repair shops (“OEM dealerships”) manage and track performance.

The equipment product category includes solutions for the service of vehicles and industrial equipment.

Snap-on supports the sale of its diagnostics and vehicle service shop equipment by offering training programs as well as after-sales support to its customers.

Through its financial services businesses, Snap-on also derives revenue from various financing programs designed to facilitate the sales of its products and support its franchise business.

Approximately 90 % of Snap-on’s net sales are products sold at a point in time through ship-and-bill performance obligations that also includes repair services.

Through its financial services businesses, Snap‑on derives revenue from various financing programs designed to facilitate the sales of its products and support its franchise business.

2021 ANNUAL REPORT 73

Notes to Consolidated Financial Statements (continued)

Approximately 90 % of Snap-on’s net sales are products sold at a point in time through ship-and-bill performance obligations that also include repair services.

The remaining sales revenue is earned over time primarily on a subscription basis including software, extended warranty and other subscription service agreements.

SNAP-ON INCORPORATED

Snap-on enters into contracts related to the selling of tools, diagnostic and repair information and equipment products and related services.

Snap-on enters into contracts related to the selling of tools, diagnostics, repair information, equipment and related services.

At contract inception, an assessment of the goods and services promised in the contracts with customers is performed and a performance obligation is identified for each distinct promise to transfer to the customer a good or service (or bundle of goods or services).

1 unchanged sentence

Contracts with customers are comprised of customer purchase orders, invoices and written contracts.

For certain performance obligations related to software subscriptions, extended warranty and other subscription agreements that are settled over time, Snap-on has elected not to disclose the value of unsatisfied performance obligations for:

(i) contracts that have an original expected length of one year or less;

(ii) contracts where revenue is recognized as invoiced;

and (iii) contracts with variable consideration related to unsatisfied performance obligations.

The remaining duration of these unsatisfied performance obligations range from one month up to 60 months.

Snap-on had approximately $ 190.0 million of long-term contracts that have fixed consideration that extends beyond one year as of January 1, 2022.

Snap-on expects to recognize approximately 75 % of these contracts as revenue by the end of fiscal 2023, an additional 20 % by the end of fiscal 2025 and the balance thereafter.

Snap-on typically expenses incremental direct costs of obtaining a contract (sales commissions) when incurred because the amortization period is generally 12 months or less.

Capitalized long-term contract costs are not significant.

Contract costs are expensed or amortized in “Operating expenses” on the accompanying Consolidated Statements of Earnings.

When performance obligations are satisfied:

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Estimated product returns are recorded as a reduction in reported revenues at the time of sale based upon historical product return experience and is adjusted for known trends to arrive at the amount of consideration that Snap-on expects to receive.

SNAP-ON INCORPORATED

Variable consideration is estimated at the most likely amount that is expected to be earned.

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Snap-on does not typically provide customers with the right to a refund.

2020 ANNUAL REPORT 75

Notes to Consolidated Financial Statements (continued)

Practical expedients and exemptions of ASU No.

2014-09, Revenue from Contracts with Customers (Topic 606) :

Snap-on typically expenses incremental direct costs of obtaining a contract (sales commissions) when incurred because the amortization period is generally 12 months or less.

Capitalized long-term contract costs are not significant.

Contract costs are expensed or amortized in “Operating expenses” on the accompanying Consolidated Statements of Earnings.

Snap-on elected to account for shipping and handling activities that occur after control of the related good transfers to the customer as fulfillment activities and are therefore recognized upon shipment of the goods.

Snap-on has applied the portfolio approach to its ship-and-bill contracts that have similar characteristics as it reasonably expects

that the effects on the financial statements of applying this guidance to the portfolio of contracts would not differ materially from applying this guidance to the individual contracts within the portfolio.

Snap-on typically excludes from its sales transaction price any amounts collected from customers for sales (and similar) taxes.

(i) contracts that have an original expected length of one year or less;

(ii) contracts where revenue is recognized as invoiced;

and (iii) contracts with variable consideration related to unsatisfied performance obligations.

The remaining duration of these unsatisfied performance obligations generally range from one month up to 60 months.

Snap-on had approximately $ 217.0 million of long-term contracts that have fixed consideration that extends beyond one year as of January 2, 2021.

Snap-on expects to recognize approximately 70 % of these contracts as revenue by the end of fiscal 2022, an additional 25 % by the end of fiscal 2024 and the balance thereafter.

Contract liabilities (Deferred revenues):

Contract liabilities:

Contract liabilities are recorded when cash payments are received in advance of Snap-on’s performance.

The timing of payment is typically on a monthly, quarterly or annual basis.

The balance of total contract liabilities was $ 61.0 million and $ 65.1 million at January 2, 2021 and December 28, 2019, respectively.

The current portion of contract liabilities is included in “Other accrued liabilities” and the non-current portion is included in “Other long-term liabilities” on the accompanying Consolidated Balance Sheets.

In 2020, Snap-on recognized revenue of $ 53.5 million that was included in the contract liability balance as of December 28, 2019, which was primarily from the amortization of software subscriptions, extended warranties and other subscription agreements.

The decrease in the total contract liabilities balance is primarily driven by the timing of cash payments received or due in advance of satisfying Snap-on’s performance obligations and growth in certain software subscriptions, partially offset by revenues recognized that were included in the contract liability balance at the beginning of the year.

The balance of total contract liabilities was $ 63.8 million and $ 61.0 million at January 1, 2022, and January 2, 2021, respectively.

The current portion of contract liabilities is included in “Other accrued liabilities” and the non-current portion of such liabilities is included in “Other long-term liabilities” on the accompanying Consolidated Balance Sheets.

In 2021, Snap-on recognized revenue of $ 52.3 million that was included in the contract liability balance at January 2, 2021, which was primarily from the amortization of software subscriptions, extended warranties and other subscription agreements.

The increase in the total contract liabilities balance is primarily driven by the timing of cash payments received or due in advance of satisfying Snap-on’s performance obligations and growth in certain software subscriptions, partially offset by revenues recognized that were included in the contract liability balance at the beginning of the year.

Franchise fee revenue, including nominal, non-refundable initial fees, is recognized upon the granting of a franchise, which is when the company has performed substantially all initial services required by the franchise agreement.

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Franchise fee revenue in 2021, 2020 and 2019 totaled $ 17.3 million, $ 16.2 million and $ 15.4 million, respectively.

On August 1, 2021, Snap-on acquired AutoCrib EMEA GmbH (“AutoCrib Germany”), a former independent distributor, for a cash purchase price of $ 4.4 million (or $ 4.2 million, net of cash acquired).

AutoCrib Germany, based in Hamburg, Germany, distributes asset and tool control solutions for a variety of aerospace, automotive, military, natural resources and general industry operations.

In fiscal 2021, the company recorded, on a preliminary basis, the $ 3.3 million excess of the purchase price over the fair value of the net assets acquired in “Goodwill” on the accompanying Consolidated Balance Sheets.

The company anticipates completing the purchase accounting for the acquired net assets of AutoCrib Germany in first half of 2022.

On July 1, 2021, Snap-on exchanged its 35 % equity interest in Deville S.A., valued at $ 21.8 million, for 100 % ownership of Secateurs Pradines (“Pradines”), a wholly owned subsidiary of Deville S.A.

with a fair value of $ 20.7 million (or $ 16.2 million, net of cash acquired), and cash of $ 1.1 million.

Pradines, located in Bauge-en-Anjou, France, designs and manufactures horticultural hand tools for professionals and individuals.

In fiscal 2021, the company recorded, on a preliminary basis, the $ 10.7 million excess of the purchase price over the fair value of net assets acquired in “Goodwill” in the accompanying Consolidated Balance Sheets.

The company anticipates completing the purchase accounting for the acquired net assets of Pradines in the first half of 2022.

On February 26, 2021, Snap-on acquired Dealer-FX Group, Inc.

(“Dealer-FX”) for a cash purchase price of $ 200.1 million (or $ 200.0 million, net of cash acquired).

Dealer-FX, based in Markham, Ontario, is a leading developer, marketer and provider of service-operations software solutions for automotive OEM customers and their dealers.

Dealer-FX specializes in software as a service (SaaS) management systems, communications platforms, extensive data integrations, and offers a digitalized solution that increases productivity and enhances the vehicle owners’ experience.

In fiscal 2021, the company substantially completed the purchase accounting valuations for the acquired net assets of Dealer-FX, including identifiable intangible assets.

Final purchase accounting valuations are expected to be completed in the first quarter of 2022, including the evaluation of tax benefits associated with net operating loss carryforwards.

The preliminary $ 150.8 million excess of the purchase price over the fair value of the net assets acquired was recorded in “Goodwill” on the accompanying Consolidated Balance Sheets.

2021 ANNUAL REPORT 75

Notes to Consolidated Financial Statements (continued)

On September 28, 2020, Snap-on acquired substantially all of the assets of AutoCrib, Inc.

1 unchanged sentence

AutoCrib, based in Tustin, California, designs, manufactures and markets asset and tool control solutions for a variety of aerospace, automotive, military, natural resources and general industry operations.

In fiscal 2020, the company substantially completed the purchase accounting valuations for the acquired net assets of AutoCrib, including intangible assets.

Final purchase accounting valuations are expected to be completed in the first quarter of 2021.

The preliminary $ 18.3 million excess of the purchase price over the fair value of the net assets acquired was recorded in “Goodwill” on the accompanying Consolidated Balance Sheets.

SNAP-ON INCORPORATED

In fiscal 2021, the company completed the purchase accounting valuations for the acquired net assets of AutoCrib, including intangible assets.

The $ 18.3 million excess of the purchase price over the fair value of the net assets acquired was recorded in “Goodwill” on the accompanying Consolidated Balance Sheets.

On January 31, 2020, Snap-on acquired substantially all of the assets related to the TreadReader product line from Sigmavision Limited (“Sigmavision”) for a cash purchase price of $ 5.9 million.

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Substantially all of the purchase price over the fair value of the net assets acquired was recorded in “Goodwill” on the accompanying Consolidated Balance Sheets.

On January 31, 2018, Snap-on acquired substantially all of the assets of George A.

Sturdevant, Inc.

(d/b/a Fastorq) for a cash purchase price of $ 3.0 million.

Fastorq, based in New Caney, Texas, designs, assembles and distributes hydraulic torque and hydraulic tensioning products for use in critical industries.

In fiscal 2018, the company completed the purchase accounting valuations for the acquired net assets of Fastorq.

The $ 2.6 million excess of the purchase price over the fair value of the net assets acquired was recorded in “Goodwill” on the accompanying Consolidated Balance Sheets.

For segment reporting purposes, the results of operations and assets of Sigmavision, Cognitran and TMB have been included in the Repair Systems & Information Group since the respective acquisition dates, and the results of operations and assets of AutoCrib, Power Hawk and Fastorq have been included in the Commercial & Industrial Group since the respective acquisition dates.

For segment reporting purposes, the results of operations and assets of Dealer-FX, Sigmavision, Cognitran and TMB have been included in the Repair Systems & Information Group since the respective acquisition dates, and the results of operations and assets of AutoCrib Germany, Pradines, AutoCrib and Power Hawk have been included in the Commercial & Industrial Group since the respective acquisition dates.

Pro forma financial information has not been presented for any of these acquisitions as the net effects, individually and collectively, were neither significant nor material to Snap-on’s results of operations or financial position.

See Note 7 for further information on goodwill and other intangible assets.

SNAP-ON INCORPORATED

At the beginning of fiscal 2020, Snap-on adopted ASU No.

3 unchanged sentences

2016-13, Snap-on is required to determine expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable forecasts.

2020 ANNUAL REPORT 77

Notes to Consolidated Financial Statements (continued)

The effects of adjustments to the December 28, 2019 Consolidated Balance Sheet as a result of the adoption of ASU No.

2016-13, including an increase in the allowance for credit losses of $ 8.1 million, were as follows:

Balance at Opening Balance at

(Amounts in millions) December 28,

2019 Topic 326 Adjustments December 29,

Current assets

Finance receivables - allowance for credit losses

$ ( 19.7 ) $ ( 1.7 ) $ ( 21.4 )

Contract receivables - allowance for credit losses

( 1.5 ) ( 0.5 ) ( 2.0 )

Long-term assets

Finance receivables - allowance for credit losses

( 42.2 ) ( 3.5 ) ( 45.7 )

Contract receivables - allowance for credit losses

( 4.1 ) ( 2.4 ) ( 6.5 )

Total allowances for credit losses $ ( 67.5 ) $ ( 8.1 ) $ ( 75.6 )

Deferred income tax assets $ 52.3 $ 2.0 $ 54.3

Retained Earnings $ 4,779.7 $ ( 6.1 ) $ 4,773.6

Trade and Other Accounts Receivable:

Snap-on’s trade and other accounts receivable primarily arise from the sale of tools and diagnostic and equipment products to a broad range of industrial and commercial customers and to Snap-on’s independent franchise van channel on a non-extended-term basis with payment terms generally ranging from 30 to 120 days.

Snap-on’s trade and other accounts receivable primarily arise from the sale of tools, diagnostics, and equipment products to a broad range of industrial and commercial customers and to Snap-on’s independent franchise van channel with payment terms generally ranging from 30 to 120 days.

The components of Snap-on’s trade and other accounts receivable as of 2021 and 2020 year end are as follows:

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Total trade and other accounts receivable – net $ 682.3 $ 640.7

The following is a rollforward of the allowances for credit losses related to trade and other accounts receivable for 2020:

The following is a rollforward of the allowances for credit losses related to trade and other accounts receivable for 2021 and 2020:

(Amounts in millions) 2021 2020

2 unchanged sentences

Provision for credit losses

( 13.6 ) ( 13.6 )

Currency translation

( 0.9 ) ( 0.1 )

End of period $ 27.3 $ 26.3

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Interest income on finance and contract receivables is included in “Financial services revenue” on the accompanying Consolidated Statements of Earnings.

SNAP-ON INCORPORATED

Snap-on’s finance receivables are comprised of extended-term payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools and diagnostic and equipment products on an extended-term payment plan, generally with payment terms of approximately four years .

Contract receivables, with payment terms of up to 10 years, are comprised of extended-term payment contracts to a broad base of customers worldwide, including shop owners, both independents and national chains, for their purchase of tools and diagnostic and equipment products, as well as extended-term contracts to franchisees to meet a number of financing needs, including working capital loans, loans to enable new franchisees to fund the purchase of the franchise and van leases, or the expansion of an existing franchise.

Finance and contract receivables are generally secured by the underlying tools and/or diagnostic or equipment products financed and, for contracts to franchisees, other franchisee assets.

Snap-on’s finance receivables are comprised of extended-term payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools, diagnostics, and equipment products on an extended-term payment plan, generally with average payment terms of approximately four years .

Contract receivables, with payment terms of up to 10 years, are comprised of extended-term payment contracts to a broad base of customers worldwide, including shop owners, both independents and national chains, for their purchase of tools, diagnostics, and equipment products, as well as extended-term contracts to franchisees to meet a number of financing needs, including working capital loans, loans to enable new franchisees to fund the purchase of the franchise and van leases, or the expansion of an existing franchise.

Finance and contract receivables are generally secured by the underlying tools, diagnostics and/or equipment products financed and, for contracts to franchisees, other franchisee assets.

2021 ANNUAL REPORT 77

Notes to Consolidated Financial Statements (continued)

The components of Snap-on’s current finance and contract receivables as of 2021 and 2020 year end are as follows:

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Total current finance and contract receivables – net $ 652.7 $ 642.7

2020 ANNUAL REPORT 79

Notes to Consolidated Financial Statements (continued)

SNAP-ON INCORPORATED

The components of Snap-on’s finance and contract receivables with payment terms beyond one year as of 2021 and 2020 year end are as follows:

19 unchanged sentences

Total long-term finance and contract receivables – net $ 1,492.2 $ 1,511.0

2021 ANNUAL REPORT 79

Notes to Consolidated Financial Statements (continued)

Long-term finance and contract receivables installments, net of unearned finance charges, as of 2021 and 2020 year end are scheduled as follows:

10 unchanged sentences

Total $ 1,159.5 $ 384.5 $ 1,188.7 $ 381.4

SNAP-ON INCORPORATED

Credit quality:

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The allowance for credit losses utilizes an expected credit loss objective for the recognition of credit losses on receivables over the contractual life using historical experience, asset specific risk characteristics, current conditions, reasonable and supportable forecasts, and the appropriate reversion period, when applicable.

SNAP-ON INCORPORATED

The allowance for credit losses is maintained at a level that is considered adequate to cover credit-related losses on the receivables.

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Changes to the allowances for credit losses are maintained through adjustments to the provision for credit losses.

2020 ANNUAL REPORT 81

Notes to Consolidated Financial Statements (continued)

For finance receivables, the company uses a vintage loss rate methodology to determine expected losses.

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Removal from delinquent status occurs when the cumulative amount of monthly contractual payments then due have been received by the company.

2021 ANNUAL REPORT 81

Notes to Consolidated Financial Statements (continued)

It is the general practice of Snap-on’s financial services business not to engage in contract or loan modifications.

1 unchanged sentence

The amount and number of restructured finance and contract receivables as of 2021 and 2020 year end were immaterial to both the financial services portfolio and the company’s results of operations and financial position.

SNAP-ON INCORPORATED

The aging of finance and contract receivables as of 2021 and 2020 year end is as follows:

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Total inventories – net $ 803.8 $ 746.5

2020 ANNUAL REPORT 83

Notes to Consolidated Financial Statements (continued)

SNAP-ON INCORPORATED

Inventories accounted for using the FIFO method approximated 60 % and 57 % of total inventories as of 2021 and 2020 year end, respectively.

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Balance as of 2021 year end $ 325.8 $ 12.4 $ 778.3 $ 1,116.5

Goodwill of $ 1,116.5 million as of 2021 year end included $ 150.8 million, on a preliminary basis, from the acquisition of Dealer-FX, $ 10.7 million, on a preliminary basis, from the acquisition of Pradines and $ 3.3 million, on a preliminary basis, from the acquisition of AutoCrib Germany.

The goodwill from Dealer-FX is included in the Repair Systems & Information Group and the goodwill from AutoCrib Germany and Pradines is included in the Commercial & Industrial Group.

Goodwill of $ 982.4 million as of 2020 year end includes:

(i) $ 5.6 million from the acquisition of certain assets of Sigmavision, (ii) $ 14.5 million from the acquisition of Cognitran;

and (iii) $ 18.3 million, on a preliminary basis, from the acquisition of AutoCrib.

and (iii) $ 18.3 million, from the acquisition of AutoCrib.

During 2020, the purchase accounting valuations for the acquired net assets, including intangible assets, of Sigmavision and Cognitran were completed, resulting in an increase in goodwill of $ 3.1 million for Cognitran.

The remaining purchase accounting valuations for the acquired net assets, including intangible assets, of AutoCrib are expected to be completed in the first quarter of 2021.

The remaining purchase accounting valuations for the acquired net assets, including intangible assets, of AutoCrib were completed in the first quarter of 2021.

The goodwill from the Sigmavision and Cognitran acquisitions is included in the Repair Systems & Information Group.

The goodwill from the AutoCrib acquisition is included in the Commercial & Industrial Group.

Goodwill of $ 913.8 million as of 2019 year end includes:

(i) $ 11.4 million, on a preliminary basis, from the acquisition of Cognitran;

(ii) $ 6.4 million from the acquisition of Power Hawk;

and (iii) $ 1.3 million from the acquisition of TMB.

The goodwill from the Cognitran and TMB acquisitions is included in the Repair Systems & Information Group.

The goodwill from the Power Hawk acquisition is included in the Commercial & Industrial Group.

SNAP-ON INCORPORATED

See Note 3 for additional information on acquisitions.

2021 ANNUAL REPORT 83

Notes to Consolidated Financial Statements (continued)

Additional disclosures related to other intangible assets as of 2021 and 2020 year end are as follows:

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Total other intangible assets $ 637.6 $ ( 335.9 ) $ 570.4 $ ( 309.6 )

As of year-end 2020, the gross carrying value of intangible assets includes $ 4.6 million of customer relationship s, $ 1.7 million of developed technology and $ 7.4 million of non-amortized trademarks as a result of the AutoCrib acquisition, as well as $ 0.3 million of patents from the Sigmavision acquisition.

As of year-end 2019, the gross carrying value of customer relationships includes $ 10.2 million related to the Cognitran acquisition and $ 0.9 million related to the Power Hawk acquisition.

Additionally, the gross carrying value of intangible assets in 2019 includes $ 6.5 million of non-amortized trademarks and $ 1.1 million of developed technology as a result of the Cognitran acquisition.

Significant and unanticipated changes in circumstances, such as declines in profitability and cash flow due to significant and long-term deterioration in macroeconomic, industry and market conditions, the loss of key customers, changes in technology or markets, significant changes in key personnel or litigation, a significant and sustained decrease in share price and/or other events, including effects from the sale or disposal of a reporting unit, could require a provision for impairment of goodwill and/or other intangible assets in a future period.

As of year-end 2021, the gross carrying value of intangible assets includes $ 28.4 million of customer relationships, $ 14.8 million of developed technology and a $ 17.7 million non-amortized trademark related to the Dealer-FX acquisition.

As of year-end 2020, the gross carrying value of intangible assets includes $ 4.6 million of customer relationship s, $ 1.7 million of developed technology and a $ 7.4 million non-amortized trademark from the AutoCrib acquisition, as well as $ 0.3 million of patents related to the Sigmavision acquisition.

Provision for impairment of goodwill and/or other intangible assets could arise in a future period due to significant and unanticipated changes in circumstances, such as declines in profitability and cash flow due to significant and long-term deterioration in macroeconomic, industry and market conditions, the loss of key customers, changes in technology or markets, significant changes in key personnel or litigation, a significant and sustained decrease in share price and/or other events, including effects from the sale or disposal of a reporting unit.

As of 2021 year end, the company had no accumulated impairment losses.

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Based on current levels of amortizable intangible assets and estimated weighted-average useful lives, estimated annual amortization expense is expected to be $ 28.0 million in 2022, $ 24.5 million in 2023, $ 18.8 million in 2024, $ 14.0 million in 2025, and $ 10.8 million in 2026.

2020 ANNUAL REPORT 85

Notes to Consolidated Financial Statements (continued)

SNAP-ON INCORPORATED

Exit and Disposal Activities

Snap-on recorded costs associated with exit and disposal activities of $ 12.5 million during 2020.

Snap-on did no t record any costs for exit and disposal activities in 2019.

Snap-on did not record any costs for exit and disposal activities during fiscal 2021.

Snap-on recorded $ 12.5 million of costs associated with exit and disposal activities during fiscal 2020.

The costs associated with disposal activities by operating segment are as follows:

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Costs associated with exit and disposal activities in 2020 primarily related to headcount reductions from the ongoing optimization of the company’s cost structure in Europe and various other management and realignment actions.

Snap-on’s exit and disposal accrual activity for 2020 is as follows:

Balance at Balance at

Snap-on’s exit and disposal accrual activity for 2021 and 2020 are as follows:

Balance at Balance at Balance at

(Amounts in millions) 2019

Provision in 2020

Usage in 2020

Provision in 2021

Usage in 2021

Severance costs:

6 unchanged sentences

The estimated costs for the exit and disposal activities were based on management’s best business judgement under prevailing circumstances.

SNAP-ON INCORPORATED

2021 ANNUAL REPORT 85

Notes to Consolidated Financial Statements (continued)

The source of earnings before income taxes and equity earnings consisted of the following:

25 unchanged sentences

Excess tax benefits related to equity compensation ( 1.0 ) ( 0.5 ) ( 0.5 )

tax reform, net impact — — 0.4

Other ( 0.2 ) ( 0.1 ) ( 0.3 )

1 unchanged sentence

Snap-on’s effective income tax rate on earnings attributable to Snap-on Incorporated was 23.2 % in 2021, 23.2 % in 2020, and 23.4 % in 2019.

The effective tax rate for 2018 included an additional non-recurring net tax charge attributable to the prior year’s U.S.

tax reform changes.

On December 22, 2017, the U.S.

government passed the Tax Cuts and Jobs Act (the “Tax Act”).

The Tax Act made broad and complex changes to the U.S.

tax code, including, but not limited to:

(i) reducing the U.S.

federal corporate tax rate from 35% to 21%;

(ii) requiring companies to pay a one-time transition tax on certain unremitted earnings of foreign subsidiaries;

and (iii) bonus depreciation that allows for full expensing of qualified property.

2020 ANNUAL REPORT 87

Notes to Consolidated Financial Statements (continued)

The Tax Act also established new tax laws that affect years after 2017, including, but not limited to:

(i) the reduction of the U.S.

federal corporate tax rate discussed above;

(ii) a general elimination of U.S.

federal income taxes on dividends from foreign subsidiaries;

(iii) a new provision designed to tax global intangible low-taxed income (“GILTI”);

(iv) the repeal of the domestic production activity deductions;

(v) limitations on the deductibility of certain executive compensation;

(vi) limitations on the use of foreign tax credits to reduce the U.S.

income tax liability;

and (vii) a new provision that allows a domestic corporation an immediate deduction for a portion of its foreign derived intangible income (“FDII”).

During 2018, the company recorded additional net tax benefits of $ 4.4 million attributable to pension contributions made in 2018 that were deductible for 2017 at the higher 35% federal tax rate and other changes to the 2017 tax provision related to the Tax Act and subsequently-issued tax guidance.

Due to the complexity of the new GILTI tax rules, the company continued to evaluate this provision of the Tax Act and the application of Accounting Standards Codification (“ASC”) 740 throughout 2018.

Under GAAP, the company is allowed to make an accounting policy choice to either:

(i) treat taxes due on future U.S.

inclusions in taxable income related to GILTI as a current-period expense when incurred (the “period cost method”);

or (ii) factor in such amounts into a company’s measurement of its deferred taxes (the “deferred method”).

The company selected to apply the “period cost method” to account for the new GILTI tax, and treated it as a current-period expense for 2020, 2019 and 2018.

Temporary differences that give rise to the net deferred income tax asset (liability) as of 2020, 2019 and 2018 year end are as follows:

SNAP-ON INCORPORATED

Temporary differences that give rise to the net deferred income tax liability as of 2021, 2020 and 2019 year end are as follows:

(Amounts in millions) 2021 2020 2019

11 unchanged sentences

Other ( 1.9 ) 1.3 ( 0.7 )

Net deferred income tax asset (liability) $ ( 20.1 ) $ ( 17.0 ) $ 23.3

Net deferred income tax liability $ ( 73.2 ) $ ( 20.1 ) $ ( 17.0 )

As of 2021 year end, Snap-on had tax net operating loss carryforwards totaling $ 160.5 million as follows:

8 unchanged sentences

Total net operating loss carryforwards $ 36.6 $ — $ 123.9 $ 160.5

SNAP-ON INCORPORATED

A valuation allowance totaling $ 24.5 million, $ 26.7 million and $ 27.8 million as of 2021, 2020 and 2019 year end, respectively, has been established for deferred income tax assets primarily related to certain subsidiary loss carryforwards that may not be realized.

2 unchanged sentences

The amount of the net deferred income tax assets considered realizable, however, could change in the near term if estimates of future taxable income during the carryforward period fluctuate.

The expected realization of tax benefits associated with the February 26, 2021 acquired loss carryforwards will be recorded in the first quarter of 2022, with the final purchase accounting valuation for Dealer-FX.

See Note 3 for more information on acquisitions.

The following is a reconciliation of the beginning and ending amounts of unrecognized tax benefits for 2021, 2020 and 2019:

7 unchanged sentences

Unrecognized tax benefits at end of year $ 8.9 $ 9.1 $ 10.3

2021 ANNUAL REPORT 87

Notes to Consolidated Financial Statements (continued)

The unrecognized tax benefits of $ 8.9 million, $ 9.1 million and $ 10.3 million as of 2021, 2020 and 2019 year end, respectively, would impact the effective income tax rate if recognized.

18 unchanged sentences

Accordingly, the company has reversed its prior assertion concerning the indefinite reinvestment of the majority of its undistributed foreign earnings and has recorded a deferred tax liability of $ 4.4 million for the incremental tax costs associated with the future potential repatriation of such earnings.

2020 ANNUAL REPORT 89

Notes to Consolidated Financial Statements (continued)

Short-term and Long-term Debt

2 unchanged sentences

6.125 % unsecured notes due 2021

$ 250.0 $ 250.0

3.25 % unsecured notes due 2027

6 unchanged sentences

$ — $ ( 250.0 )

Commercial paper borrowings

( 17.4 ) ( 18.5 )

2 unchanged sentences

* Includes the net effects of debt amortization costs and fair value adjustments related to interest rate swaps.

The annual maturities of Snap-on’s long-term debt and notes payable over the next five years are $ 268.5 million in 2021, with no maturities in 2022, 2023, 2024 and 2025.

Average notes payable outstanding, including commercial paper and short-term credit facility borrowings, were $ 68.4 million and $ 175.0 million in 2020 and 2019, respectively.

SNAP-ON INCORPORATED

There are no annual maturities of Snap-on’s long-term debt and notes payable over the next five years.

Average notes payable outstanding, including commercial paper borrowings in 2020 and short-term credit facility borrowings in both years, were $ 16.7 million and $ 68.4 million in 2021 and 2020, respectively.

The 2021 weighted-average interest rate on such borrowings of 8.39 % compared with 2.98 % in 2020.

Average commercial paper borrowings were $ 41.0 million and $ 162.2 million in 2020 and 2019, respectively, and the weighted-average interest rate of 1.53 % on such borrowings in 2020 decreased from 2.27 % last year.

No commercial paper was outstanding as of year-end 2020.

There were no commercial paper borrowings during 2021.

Average commercial paper borrowings were $ 41.0 million in 2020 with a weighted-average interest rate of 1.53 %.

No commercial paper was outstanding as of year-end 2021 or 2020.

There were no amounts borrowed under the short-term credit facility during 2021.

Average short-term credit facility borrowings were $ 13.9 million in 2020 with a weighted-average interest rate of 1.7 %.

No amounts were outstanding under the short-term credit facility as of year-end 2020 and no amounts were borrowed under the short-term credit facility in 2019.

No amounts were outstanding under the short-term credit facility as of year-end 2021 or 2020.

At 2021 year end, the weighted-average interest rate on outstanding notes payable of 8.39 % compared with 8.87 % in 2020.

The 2020 year-end rate increased primarily due to higher local borrowings in emerging markets.

The 2021 year-end rate decreased primarily due to lower rates on local borrowings in emerging markets.

On April 27, 2020, Snap-on sold, at a discount, $ 500 million of unsecured 3.10 % notes that mature on May 1, 2050 (the “2050 Notes”).

Interest on the 2050 Notes accrues at a rate of 3.10 % and is paid semi-annually.

Snap-on used the $ 489.9 million net proceeds from the sale of the 2050 Notes, reflecting $ 4.4 million of transaction costs, for general corporate purposes, which may include working capital, capital expenditures and potential acquisitions.

Snap-on used the $ 489.9 million net proceeds from the sale of the 2050 Notes, reflecting $ 4.4 million of transaction costs, for general corporate purposes, which included working capital, capital expenditures and acquisitions.

Snap-on has an $ 800 million multi-currency revolving credit facility that terminates on September 16, 2024 (the “Credit Facility”);

8 unchanged sentences

Snap-on generally issues commercial paper to fund its financing needs on a short-term basis and uses the Credit Facility as back-up liquidity to support such commercial paper issuances.

SNAP-ON INCORPORATED

Financial Instruments

11 unchanged sentences

The primary risks managed by using derivative instruments are foreign currency risk, interest rate risk and stock-based deferred compensation risk.

2021 ANNUAL REPORT 89

Notes to Consolidated Financial Statements (continued)

Foreign currency risk management:

8 unchanged sentences

See Note 18 for additional information on Other income (expense) - net.

As of 2021 year end, Snap-on had $ 81.3 million of net foreign currency forward sell contracts outstanding comprised of sell contracts including $ 290.0 million in Canadian dollars, $ 10.3 million in euros, $ 8.1 million in Indian rupees, $ 6.3 million in Hungarian forints, and $ 4.5 million in other currencies, and buy contracts comprised of $ 79.6 million in British pounds, $ 48.4 million in Swedish kronor, $ 31.0 million in Chinese renminbi, $ 30.0 million in Hong Kong dollars, $ 14.3 million in Australian dollars, $ 14.2 million in Singapore dollars, $ 7.2 million in Norwegian kroner, $ 4.9 million in Danish kroner, and $ 8.3 million in other currencies.

As of 2020 year end, Snap-on had $ 46.7 million of net foreign currency forward buy contracts outstanding comprised of buy contracts including $ 58.9 million in Swedish kronor, $ 43.5 million in British pounds, $ 26.1 million in Chinese renminbi, $ 22.5 million in Hong Kong dollars, $ 14.6 million in Singapore dollars, $ 6.2 million in Australian dollars, $ 5.8 million in Norwegian kroner, $ 5.1 million in Danish kroner, and $ 3.7 million in other currencies, and sell contracts comprised of $ 120.4 million in Canadian dollars, $ 7.9 million in Indian rupees, $ 3.5 million in Hungarian forints, and $ 7.9 million in other currencies.

As of 2019 year end, Snap-on had $ 33.2 million of net foreign currency forward buy contracts outstanding comprised of buy contracts including $ 41.4 million in euros, $ 34.5 million in Swedish kronor, $ 17.4 million in Hong Kong dollars, $ 13.1 million in Chinese renminbi, $ 13.0 million in Singapore dollars, $ 6.0 million in Norwegian kroner, and $ 7.0 million in other currencies, and sell contracts comprised of $ 52.9 million in British pounds, $ 17.5 million in Canadian dollars, $ 10.0 million in Indian rupees, $ 9.6 million in Japanese yen, and $ 9.2 million in other currencies.

Interest rate risk management:

4 unchanged sentences

The differentials paid or received on interest rate swaps are recognized as adjustments to “Interest expense” on the accompanying Consolidated Statements of Earnings.

The change in fair value of the designated and qualifying derivative is recorded in “Notes payable and current maturities of long-term debt” in 2020 and “Long-term debt” in 2019 on the accompanying Consolidated Balance Sheets.

The notional amount of interest rate swaps outstanding and designated as fair value hedges was $ 100 million as of both 2020 and 2019 year end.

2020 ANNUAL REPORT 91

Notes to Consolidated Financial Statements (continued)

The change in the fair value of the derivative is recorded in “Notes payable and current maturities of long-term debt” in 2020 on the accompanying Consolidated Balance Sheets.

As of 2020 year end, the notional amount of interest rate swaps outstanding and designated as fair value hedges was $ 100 million.

The interest rate swaps matured in fiscal 2021 and there were no outstanding swaps as of 2021 year end.

Consolidated Balance Sheets Line Item Where Hedge Item is Recorded Carrying Amount of the Hedged Assets/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities)

2 unchanged sentences

Notes payable and current maturities of long-term debt $ — $ ( 255.1 ) $ — $ ( 5.1 )

Long-term debt* — ( 255.0 ) — ( 5.0 )

* The interest rate swap transacted in March 2010 was designated as a hedge of the first $ 100 million issuance of the $ 250 million, 6.125 % unsecured notes due September 1, 2021.

Treasury locks:

2 unchanged sentences

The differentials to be paid or received on treasury locks related to the anticipated issuance of fixed rate debt are initially recorded in Accumulated OCI for derivative instruments that are designated and qualify as cash flow hedges.

Upon the issuance of debt, the related amount in Accumulated OCI is released over the hedging instrument’s designated term and recognized as an adjustment to interest expense on the Consolidated Statements of Earnings.

Upon the issuance of debt, the related amount in Accumulated OCI is released over the term of the debt and recognized as an adjustment to interest expense on the Consolidated Statements of Earnings.

SNAP-ON INCORPORATED

In the second quarter of 2020, Snap-on entered into a $ 300.0 million treasury lock to manage changes in interest rates in anticipation of the issuance of fixed rate debt.

1 unchanged sentence

The $ 1.4 million gain on the settlement of the treasury lock was recorded in Accumulated OCI and is being amortized over the initial 10 -year term of the 2050 Notes and recognized as an adjustment to interest expense on the Consolidated Statements of Earnings.

There were no treasury locks outstanding as of both January 2, 2021 and December 28, 2019.

There were no treasury locks outstanding as of both January 1, 2022, and January 2, 2021.

See Note 18 for additional information on Other income (expense) - net.

8 unchanged sentences

Snap-on does not anticipate non-performance by its counterparties, but cannot provide assurances.

SNAP-ON INCORPORATED

Fair value measurements:

18 unchanged sentences

Total derivative instruments $ 25.7 $ 5.3 $ 30.8 $ 7.0

2021 ANNUAL REPORT 91

Notes to Consolidated Financial Statements (continued)

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between participants at the measurement date.

9 unchanged sentences

Treasury locks $ — $ 1.4 $ —

2020 ANNUAL REPORT 93

Notes to Consolidated Financial Statements (continued)

The effect of derivative instruments designated as fair value and cash flow hedges as included in the Consolidated Statements of Earnings is as follows:

14 unchanged sentences

$ 1.6 $ — $ 1.6 $ — $ 1.5 $ —

Gain on settlement

— — — — — 13.3

As of 2020 year end, the maximum maturity date of any fair value hedge was one year .

During the next 12 months, Snap-on expects to reclassify into earnings net gains from Accumulated OCI of approximately $ 1.2 million after tax at the time the underlying hedge transactions are realized.

SNAP-ON INCORPORATED

The effects of derivative instruments not designated as hedging instruments as included in the Consolidated Statements of Earnings are as follows:

11 unchanged sentences

Operating expenses ( 4.3 ) ( 1.2 ) ( 3.0 )

SNAP-ON INCORPORATED

Snap-on’s foreign currency forwards are typically not designated as hedges for financial reporting purposes.

21 unchanged sentences

• The fair value of all other financial instruments, including trade and other accounts receivable, accounts payable and other financial instruments, approximates such instruments’ carrying value due to their short-term nature.

2021 ANNUAL REPORT 93

Notes to Consolidated Financial Statements (continued)

Pension Plans

4 unchanged sentences

Normal retirement age is 65 , with provisions for earlier retirement.

2020 ANNUAL REPORT 95

Notes to Consolidated Financial Statements (continued)

The status of Snap-on’s pension plans as of 2021 and 2020 year end is as follows:

7 unchanged sentences

Benefits paid ( 75.6 ) ( 72.1 )

Actuarial loss 122.8 169.5

Actuarial (gain) loss ( 30.2 ) 122.8

Foreign currency impact ( 8.7 ) 17.5

8 unchanged sentences

Fair value of plan assets at end of year $ 1,710.9 $ 1,632.4

Unfunded status at end of year $ ( 77.6 ) $ ( 110.1 )

The increase in the defined benefit pension plans benefit obligations in 2020 was primarily due to a decrease in the discount rate in 2020 as compared to 2019.

Funded (unfunded) status at end of year $ 43.8 $ ( 77.6 )

The decrease in the defined benefit pension plans benefit obligations in 2021 was primarily due to an increase in the discount rate in 2021 as compared to 2020.

Amounts recognized in the Consolidated Balance Sheets as of 2021 and 2020 year end are as follows:

3 unchanged sentences

Pension liabilities ( 104.9 ) ( 127.1 )

Net liability $ ( 77.6 ) $ ( 110.1 )

Net asset (liability) $ 43.8 $ ( 77.6 )

Amounts included in Accumulated OCI on the accompanying Consolidated Balance Sheets as of 2021 and 2020 year end are as follows:

22 unchanged sentences

Amortization of unrecognized loss 36.3 34.5 25.2

Amortization of prior service credit — ( 0.9 ) ( 1.2 )

Amortization of prior service cost (credit) 0.1 — ( 0.9 )

Net periodic benefit cost $ 13.1 $ 15.5 $ 12.7

1 unchanged sentence

Net (gain) loss $ ( 92.8 ) $ ( 31.6 ) $ 31.9

Prior service cost 0.1 0.4 1.7

Prior service cost (credit) ( 0.1 ) 0.1 0.4

Total recognized in OCI $ ( 92.9 ) $ ( 31.5 ) $ 32.3

6 unchanged sentences

Rate of compensation increase 3.4 % 3.4 % 3.4 %

Interest crediting rate - U.S.

cash balance plan 3.8 % 3.8 % 3.8 %

The worldwide weighted-average assumptions used to determine Snap-on’s projected benefit obligation as of 2021 and 2020 year end are as follows:

24 unchanged sentences

2027-2031 493.9

SNAP-ON INCORPORATED

Snap-on’s domestic pension plans have a long-term investment horizon and a total return strategy that emphasizes a capital growth objective.

9 unchanged sentences

The asset return assumption is also adjusted by an implicit expense load for estimated administrative and investment-related expenses.

SNAP-ON INCORPORATED

For risk and correlation assumptions, the actual experience for each asset class is reviewed for the longest time period available.

8 unchanged sentences

Debt securities and cash and cash equivalents 41 % 42 % 41 %

Real estate and other real assets — — 1 %

Hedge funds 5 % 6 % 5 %

11 unchanged sentences

such investments that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy.

2020 ANNUAL REPORT 99

Notes to Consolidated Financial Statements (continued)

Private equity partnership funds, hedge funds, and real estate and other real assets are valued at the NAV as reported by the fund managers.

6 unchanged sentences

The fair value amounts presented in these tables are intended to permit a reconciliation of the fair value hierarchy to the pension plan assets.

2021 ANNUAL REPORT 97

Notes to Consolidated Financial Statements (continued)

The following is a summary, by asset category, of the fair value and the level within the fair value hierarchy of Snap-on’s domestic pension plans’ assets as of 2021 year end:

20 unchanged sentences

Total $ 372.2 $ 415.0 $ 677.5 $ 1,464.7

SNAP-ON INCORPORATED

The following is a summary, by asset category, of the fair value and the level within the fair value hierarchy of Snap-on’s domestic pension plans’ assets as of 2020 year end:

23 unchanged sentences

The company believes the foreign pension plans’ assets, which are managed locally by professional investment firms, are well diversified.

SNAP-ON INCORPORATED

The expected long-term rates of return on foreign plans’ assets, which range from 1.3 % to 5.6 % as of 2021 year end, reflect management’s expectations of long-term average rates of return on funds invested to provide benefits included in the plans’ projected benefit obligation.

11 unchanged sentences

* Includes commingled funds - multi-strategy

2020 ANNUAL REPORT 101

Notes to Consolidated Financial Statements (continued)

The following is a summary, by asset category, of the fair value and the level within the fair value hierarchy of Snap-on’s foreign pension plans’ assets as of 2021 year end:

24 unchanged sentences

Total $ 13.0 $ 56.0 $ 162.4 $ 231.4

2021 ANNUAL REPORT 99

Notes to Consolidated Financial Statements (continued)

Snap-on has several 401(k) plans covering certain U.S.

10 unchanged sentences

Benefits are paid based on deductibles and percentages of covered expenses and take into consideration payments made by Medicare and other insurance coverage.

SNAP-ON INCORPORATED

Snap-on has a Voluntary Employees Beneficiary Association (“VEBA”) trust for the funding of existing postretirement health care benefits for certain union retirees in the United States;

8 unchanged sentences

Benefits paid ( 3.6 ) ( 3.6 )

Actuarial loss 3.3 4.4

Actuarial (gain) loss ( 0.8 ) 3.3

Benefit obligation at end of year $ 47.5 $ 50.6

15 unchanged sentences

Net gain, net of tax of $ 0.8 million and $ 0.5 million, respectively

2020 ANNUAL REPORT 103

Notes to Consolidated Financial Statements (continued)

SNAP-ON INCORPORATED

The components of net periodic benefit cost and changes recognized in OCI are as follows:

23 unchanged sentences

Since asset allocation is a key determinant of expected investment returns, assets are periodically rebalanced to the targeted allocation to correct significant deviations from the asset allocation policy that are caused by market fluctuations and cash flow.

SNAP-ON INCORPORATED

2021 ANNUAL REPORT 101

Notes to Consolidated Financial Statements (continued)

The basis for determining the overall expected long-term return on plan assets assumption is a nominal returns forecasting method.

27 unchanged sentences

The fair value amounts presented in these tables are intended to permit a reconciliation of the fair value hierarchy to the VEBA plan assets.

2020 ANNUAL REPORT 105

Notes to Consolidated Financial Statements (continued)

SNAP-ON INCORPORATED

The following is a summary, by asset category, of the fair value and the level within the fair value hierarchy of the VEBA plan assets as of 2021 year end:

18 unchanged sentences

The 2011 Incentive Stock and Awards Plan (the “2011 Plan”) provides for the grant of stock options, performance awards, SARs and restricted stock awards (which may be designated as “restricted stock units” or “RSUs”).

No further grants are being made under its predecessor, the 2001 Incentive Stock and Awards Plan (the “2001 Plan”), although outstanding awards under the 2001 Plan continue in accordance with their terms.

As of 2021 year end, the 2011 Plan had 3,643,845 shares available for future grants.

The company uses treasury stock to deliver shares under both the 2001 and 2011 Plans.

The company uses treasury stock to deliver shares under the 2011 Plan.

Net stock-based compensation expense was $ 41.4 million in 2021, $ 19.5 million in 2020 and $ 23.8 million in 2019.

4 unchanged sentences

Stock option grants vest ratably on the first, second and third anniversaries of the date of grant.

SNAP-ON INCORPORATED

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes valuation model.

4 unchanged sentences

treasury yield curve on the grant date for the expected term of the option.

2021 ANNUAL REPORT 103

Notes to Consolidated Financial Statements (continued)

The following weighted-average assumptions were used in calculating the fair value of stock options granted during 2021, 2020 and 2019, using the Black-Scholes valuation model:

20 unchanged sentences

As of 2021 year end, there was $ 10.2 million of unrecognized compensation cost related to non-vested stock options that is expected to be recognized as a charge to earnings over a weighted-average period of 1.4 years.

Performance awards:

Performance awards, which are granted as performance share units (“PSUs”) and performance-based RSUs, are earned and expensed using the fair value of the award over a contractual term of three years based on the company’s performance.

Vesting of the performance awards is dependent upon performance relative to pre-defined goals for revenue growth and return on net assets for the applicable performance period.

Performance share unit and restricted stock unit awards:

Performance share units (“PSUs”) are earned and expensed using the fair value of the award over a contractual term of three years based on the company’s performance.

Vesting of the PSUs is dependent upon performance relative to pre-defined goals for revenue growth and return on net assets for the applicable performance period.

For performance achieved above specified levels, the recipient may earn additional shares of stock, not to exceed 100 % of the number of performance awards initially granted.

The PSUs have a three-year performance period based on the results of the consolidated financial metrics of the company.

The performance-based RSUs have a one-year performance period based on the results of the consolidated financial metrics of the company followed by a two-year cliff vesting schedule, assuming continued employment.

2020 ANNUAL REPORT 107

Notes to Consolidated Financial Statements (continued)

The fair value of performance awards is calculated using the market value of a share of Snap-on’s common stock on the date of grant and assumed forfeitures based on recent historical experience;

Time-based RSUs are earned and expensed using the fair value of the award over the contractual term of three years .

Vesting of the time-based RSUs is dependent upon continued employment for the 3-year cliff vesting period.

Prior to 2021, the company granted performance-based RSUs with a one-year performance period followed by a two-year cliff vesting schedule.

The fair value of PSUs and RSUs is calculated using the market value of a share of Snap-on’s common stock on the date of grant and assumed forfeitures based on recent historical experience;

in recent years, forfeitures have not been significant.

The weighted-average grant date fair value of performance awards granted during 2020, 2019 and 2018 was $ 155.34 , $ 155.92 and $ 161.18 , respectively.

There were no earned PSUs as of the 2020 year end.

Earned PSUs totaled 21,183 shares as of 2019 year end and 32,154 shares as of 2018 year end.

Any earned PSUs vest and are generally paid out following the conclusion of the applicable performance period upon approval by the Organization and Executive Compensation Committee of the company’s Board of Directors (the “Board”).

PSUs related to 21,183 shares, 32,114 shares and 50,182 shares were paid out in 2020, 2019 and 2018, respectively.

Based on the company’s 2020 performance, none of the RSUs granted in 2020 were earned.

Based on the company’s 2019 performance, none of the RSUs granted in 2019 were earned.

Based on the company’s 2018 performance, 33,170 RSUs granted in 2018 were earned;

these RSUs vested as of fiscal 2020 year end and were paid out shortly thereafter.

Changes to the company’s non-vested performance awards in 2020 are as follows:

The weighted-average grant date fair value of awards granted during 2021, 2020 and 2019, was $ 184.32 , $ 155.34 and $ 155.92 , respectively.

Earned PSUs totaled 46,343 shares as of the 2021 year end.

There were no earned PSUs as of the 2020 year end and as of 2019 year end earned PSUs totaled 21,183 shares.

Earned PSUs vest and are generally paid out following the conclusion of the applicable performance period upon approval by the Organization and Executive Compensation Committee of the company’s Board of Directors (the “Board”).

There were no PSUs paid out in 2021.

PSUs related to 21,183 shares and 32,114 shares were paid out in 2020 and 2019, respectively.

In fiscal 2021, 32,265 time-based RSUs were granted;

assuming continued employment, these RSUs will vest at the end of the 3-year cliff vesting period.

Based on the company’s 2020 and 2019 performance, none of the performance-based RSUs granted in either 2020 or 2019 were earned.

SNAP-ON INCORPORATED

Changes to the company’s non-vested PSUs and RSUs in 2021 are as follows:

(in thousands)

Non-vested performance awards at beginning of year 98 $ 158.94

Non-vested PSUs and RSUs at beginning of year 76 $ 155.61

Granted 188 184.32

1 unchanged sentence

Cancellations and other ( 3 ) 181.51

Non-vested performance awards at end of year 76 155.61

Non-vested PSUs and RSUs at end of year 215 180.29

* Weighted-average

As of 2020 year end, there was $ 6.1 million of unrecognized compensation cost related to non-vested performance awards that is expected to be recognized as a charge to earnings over a weighted-average period of 1.7 years.

As of 2021 year end, there was $ 22.9 million of unrecognized compensation cost related to non-vested PSUs and RSUs that is expected to be recognized as a charge to earnings over a weighted-average period of 1.4 years.

Stock appreciation rights:

13 unchanged sentences

treasury yield curve in effect as of the grant date (for stock-settled SARs) or reporting date (for cash-settled SARs) for the length of time corresponding to the expected term of the SARs.

SNAP-ON INCORPORATED

The following weighted-average assumptions were used in calculating the fair value of stock-settled SARs granted during 2021, 2020 and 2019, using the Black-Scholes valuation model:

5 unchanged sentences

Risk-free interest rate 0.19 % 1.42 % 2.48 %

2021 ANNUAL REPORT 105

Notes to Consolidated Financial Statements (continued)

Changes to the company’s stock-settled SARs in 2021 are as follows:

22 unchanged sentences

The intrinsic value of cash-settled SARs exercised was $ 0.6 million in 2021, $ 1.0 million in 2020 and $ 1.2 million in 2019.

The fair value of cash-settled SARs vested during 2020 was zero and $ 0.1 million in both 2019 and 2018.

2020 ANNUAL REPORT 109

Notes to Consolidated Financial Statements (continued)

C hanges to the company’s non-vested cash-settled SARs in 2020 are as follows:

The fair value of cash-settled SARs vested during 2021, 2020 and 2019 was $ 0.1 million, zero and $ 0.1 million, respectively.

Changes to the company’s non-vested cash-settled SARs in 2021 are as follows:

(in thousands)

10 unchanged sentences

If termination of the recipient’s service occurs prior to the first anniversary of the grant date for any reason other than death or disability, the shares of restricted stock would be forfeited, unless otherwise determined by the Board.

SNAP-ON INCORPORATED

Directors’ fee plan:

17 unchanged sentences

The company recognized mark-to-market expense of $ 16.7 million in 2021, $ 1.9 million in 2020, and $ 0.8 million in 2019.

SNAP-ON INCORPORATED

Capital Stock

17 unchanged sentences

Approximately 2,700 employees, or 21 % of Snap-on’s worldwide workforce, are represented by unions and/or covered under collective bargaining agreements.

The number of covered union employees whose contracts expire over the next five years approximates 1,325 employees in 2021, 475 employees in 2022, and 800 employees in 2023;

there are no contracts currently scheduled to expire in 2024 or 2025.

The number of covered union employees whose contracts expire over the next five years approximates 1,300 employees in 2022, 875 employees in 2023, 400 employees in 2024, and 125 employees in 2025;

there are no contracts currently scheduled to expire in 2026.

In recent years, Snap-on has not experienced any significant work slowdowns, stoppages or other labor disruptions.

Snap-on is involved in various legal matters that are being litigated and/or settled in the ordinary course of business.

Although it is not possible to predict the outcome of legal matters, management believes that the results of all legal matters will not have a material impact on Snap-on’s consolidated financial position, results of operations or cash flows.

The Consolidated Balance Sheet as of December 29, 2018, included an accrual of $ 30.9 million related to a judgment from the fourth quarter of 2017 for a patent-related litigation matter that was being appealed, which was subsequently settled in 2019.

The company recognized an $ 11.6 million benefit in “Operating expenses” on the Consolidated Statements of Earnings in fiscal 2019 as a result of the settlement.

2021 ANNUAL REPORT 107

Notes to Consolidated Financial Statements (continued)

Snap-on is involved in various legal matters that are being litigated and/or settled in the ordinary course of business.

Lessee accounting:

48 unchanged sentences

Weighted-average lease terms and discount rates in 2021 and 2020 are as follows:

2021 2020 2019

Weighted-average remaining lease terms:

Finance leases 3.7 years 4.5 years

Operating leases 3.3 years 3.7 years

Finance leases 2.9 years 3.7 years 4.5 years

Operating leases 3.3 years 3.3 years 3.7 years

Weighted-average discount rates:

5 unchanged sentences

2023 14.8 2.4

2024 10.2 1.9

2027 and thereafter 0.7 —

3 unchanged sentences

In 2021, Snap-on did not have any significant additional operating or finance leases that have not yet commenced.

Rent expense for worldwide facilities, office equipment and vehicles, net of sub-lease rental income, was $ 33.0 million in 2018.

2021 ANNUAL REPORT 109

27 unchanged sentences

15.2 10.6 10.4

Settlement of treasury lock — — 13.3

Loss on early extinguishment of debt — — ( 7.8 )

Foreign currency translation loss from sale of equity interest ( 1.0 ) — —

Other 1.4 0.3 0.5

6 unchanged sentences

Postretirement

Balance as of 2018 year end $ ( 177.9 ) $ 12.2 $ ( 296.5 ) $ ( 462.2 )

Impact of the Tax Act on Accumulated Other Comprehensive Income (ASU No.

— — ( 45.9 ) ( 45.9 )

Balance at beginning of 2020 $ ( 187.4 ) $ 10.7 $ ( 331.2 ) $ ( 507.9 )

Other comprehensive loss before reclassifications ( 9.5 ) — ( 6.5 ) ( 16.0 )

Other comprehensive income before reclassifications 112.7 1.4 3.5 117.6

Amounts reclassified from Accumulated OCI — ( 1.6 ) 26.1 24.5

1 unchanged sentence

Balance as of 2020 year end $ ( 74.7 ) $ 10.5 $ ( 301.6 ) $ ( 365.8 )

Other comprehensive income before reclassifications 112.7 1.4 3.5 117.6

Other comprehensive income (loss) before reclassifications ( 69.4 ) — 66.5 ( 2.9 )

Amounts reclassified from Accumulated OCI ( 1.0 ) ( 1.6 ) 27.4 24.8

5 unchanged sentences

(Amounts in millions) 2021 2020

Foreign currency loss from sale of equity interest:

Foreign currency $ 1.0 $ — Other income (expense) - net

Income tax expense — — Income tax expense

Net of tax 1.0 —

Gains on cash flow hedges:

9 unchanged sentences

see Note 12 and Note 13 for further information.

2020 ANNUAL REPORT 115

Notes to Consolidated Financial Statements (continued)

Snap-on’s business segments are based on the organization structure used by management for making operating and investment decisions and for assessing performance.

8 unchanged sentences

Financial Services consists of the business operations of Snap-on’s finance subsidiaries.

2021 ANNUAL REPORT 111

Notes to Consolidated Financial Statements (continued)

Snap-on evaluates the performance of its operating segments based on segment revenues, including both external and intersegment net sales, and segment operating earnings.

25 unchanged sentences

Earnings before income taxes and equity earnings $ 1,086.9 $ 835.2 $ 922.1

SNAP-ON INCORPORATED

Financial Data by Segment (continued):

(Amounts in millions) 2021 2020

7 unchanged sentences

Total assets $ 6,759.7 $ 6,557.3

SNAP-ON INCORPORATED

Financial Data by Segment (continued):

(Amounts in millions) 2021 2020 2019

15 unchanged sentences

Total depreciation and amortization $ 104.8 $ 96.7 $ 92.4

2020 ANNUAL REPORT 117

Notes to Consolidated Financial Statements (continued)

Financial Data by Segment (continued):

(Amounts in millions) 2020 2019 2018

Revenues by geographic region:*

6 unchanged sentences

United States $ 342.2 $ 345.3

Sweden 248.4 218.7

Europe 171.2 174.2

All other 56.7 58.6

1 unchanged sentence

* Revenues are attributed to countries based on origin of the sale.

** Long-lived assets consist of Property and equipment - net, Goodwill, and Other intangibles - net.

** Long-lived assets consist of Property and equipment - net and Operating lease right-of-use assets.

Prior year has been recast to conform with the current year presentation which includes Operating lease right-of-use assets and excludes Goodwill and Other intangibles - net.

2021 ANNUAL REPORT 113

Notes to Consolidated Financial Statements (continued)

Products and Services:

3 unchanged sentences

The tools product category includes hand tools, power tools, tool storage products and other similar products.

The diagnostics, information and management systems product category includes handheld and PC-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, OEM purchasing facilitation services, and warranty management systems and analytics to help OEM dealerships manage and track performance.

The diagnostics, information and management systems product category includes handheld and computer-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, OEM purchasing facilitation services, and warranty management systems and analytics to help OEM dealerships manage and track performance.

The equipment product category includes solutions for the service of vehicles and industrial equipment.

Snap-on supports the sale of its diagnostics and vehicle service shop equipment by offering training programs as well as after-sales service support to its customers.

Snap-on supports the sale of its diagnostics and vehicle service shop equipment by offering training programs as well as after-sales service support for its customers.

Through its financial services businesses, Snap-on also derives revenue from various financing programs designed to facilitate the sales of its products and support its franchise business.

9 unchanged sentences

SNAP-ON INCORPORATED

Quarterly Data (unaudited)

(Amounts in millions, except per share data) First

Quarter Second

Quarter Third Quarter Fourth

Quarter Total

Net sales $ 852.2 $ 724.3 $ 941.6 $ 1,074.4 $ 3,592.5

Gross profit 421.6 341.2 469.5 516.2 1,748.5

Financial services revenue 85.9 84.6 85.8 93.4 349.7

Financial services expenses ( 29.0 ) ( 27.0 ) ( 20.2 ) ( 24.9 ) ( 101.1 )

Net earnings 142.0 105.9 184.7 213.8 646.4

Net earnings attributable to Snap-on Incorporated 137.2 101.2 179.7 208.9 627.0

Earnings per share – basic 2.52 1.86 3.31 3.85 11.55

Earnings per share – diluted 2.49 1.85 3.28 3.82 11.44

Cash dividends paid per share 1.08 1.08 1.08 1.23 4.47

Quarter Second

Quarter Third Quarter Fourth

Quarter Total

Net sales $ 921.7 $ 951.3 $ 901.8 $ 955.2 $ 3,730.0

Gross profit 471.6 473.8 448.1 450.5 1,844.0

Financial services revenue 85.6 84.1 84.1 83.9 337.7

Financial services expenses ( 23.5 ) ( 23.5 ) ( 23.1 ) ( 21.7 ) ( 91.8 )

Net earnings 182.1 184.9 169.2 175.0 711.2

Net earnings attributable to Snap-on Incorporated 177.9 180.4 164.6 170.6 693.5

Earnings per share – basic 3.21 3.27 2.99 3.12 12.59

Earnings per share – diluted 3.16 3.22 2.96 3.08 12.41

Cash dividends paid per share 0.95 0.95 0.95 1.08 3.93

2020 ANNUAL REPORT 119

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

15 unchanged sentences

Vice President – Finance and Chief Financial Officer

/s/ Richard K.

Ozolins Date:

February 10, 2022

Strege, Principal Accounting Officer,

Ozolins, Principal Accounting Officer,

Vice President and Controller

SNAP-ON INCORPORATED

2021 ANNUAL REPORT 115

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

28 unchanged sentences

Stebbins, Director

2020 ANNUAL REPORT 121

SNAP-ON INCORPORATED

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures