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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

                [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                   FOR THE FISCAL YEAR ENDED JANUARY 31, 1999
                                       OR
              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
          FOR THE TRANSITION PERIOD FROM ____________ TO _____________

                           COMMISSION FILE NO. 1-12641

                                RDO EQUIPMENT CO.
             (Exact name of registrant as specified in its charter)

               DELAWARE                            45-0306084
      (State of incorporation)        (I.R.S. Employer Identification No.)

                           2829 SOUTH UNIVERSITY DRIVE
                            FARGO, NORTH DAKOTA 58103
               (Address of principal executive offices) (Zip code)

       Registrant's telephone number, including area code: (701) 297-4288

Securities registered pursuant to Section 12(b) of the Act:
                                            CLASS A COMMON STOCK, $.01 PAR VALUE

Securities registered pursuant to Section 12(g) of the Act: NONE

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. _X_ YES ___ NO

         Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]

         The aggregate market value of common equity held by persons other than
directors and officers was approximately $37.8 million as of April 9, 1999. At
that date, 5,731,008 shares of Class A Common Stock and 7,450,492 shares of
Class B Common Stock were outstanding for a total of 13,181,500 shares of Common
Stock.

                       DOCUMENTS INCORPORATED BY REFERENCE

         Portions of the annual report to shareholders for the year ended
January 31, 1999 (the "1999 Annual Report") are incorporated by reference in
Part II. Portions of the proxy statement for the annual meeting to be held on
June 3, 1999 ("1999 Proxy Statement") are incorporated by reference in Part III.

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                         CAUTIONARY STATEMENT REGARDING
                  FUTURE RESULTS AND FORWARD-LOOKING STATEMENTS

            The future results of RDO Equipment Co. (the "Company"), including
results reflected in any forward-looking statement made by or on behalf of the
Company, will be impacted by a number of important factors. The factors
identified below in the section entitled "Certain Important Factors" are
important factors (but not necessarily all important factors) that could cause
the Company's actual future results to differ materially from those expressed in
any forward-looking statement made by or on behalf of the Company. Any
statements contained or incorporated by reference in this Annual Report on Form
10-K that are not statements of historical fact may be deemed to be
forward-looking statements. Without limiting the foregoing, words such as "may,"
"will," "expect," "believe," "anticipate," "estimate" or "continue" or
comparable terminology are intended to identify forward-looking statements.
Forward-looking statements, by their nature, involve substantial risks and
uncertainties.


                                     PART I
ITEM 1.     BUSINESS.

GENERAL

            The Company is one of the leading and fastest growing companies
engaged in the restructuring and consolidation of the equipment and truck retail
industries. It specializes in the distribution, sale, service, rental and
finance of equipment and trucks to the agricultural, construction,
manufacturing, transportation and warehousing industries, as well as to public
service entities, government agencies and utilities. The Company operates 66
retail stores in 11 states - Arizona, California, Iowa, Minnesota, Montana,
Nebraska, Nevada, North Dakota, South Dakota, Texas and Washington. Its stores
include the largest network of Deere & Company ("Deere") construction equipment
dealerships and agricultural equipment dealerships in North America. The Company
believes that its network of stores enables it to achieve benefits by increasing
operational synergies. The Company expects to continue to expand through future
acquisitions of agricultural, construction, material handling and truck
dealerships and through the future opening and acquisition of equipment rental
stores.

            New products sold by the Company are supplied primarily by Deere,
which is a leading manufacturer and supplier of construction and agricultural
equipment in North America. Sales of new Deere equipment by the Company
accounted for approximately 62% of the Company's new product sales in fiscal
1999. No other supplier accounted for more than 10% of the Company's new product
sales in fiscal 1999. The Company's stores also offer complementary products
from other suppliers, used products, new and used parts, product servicing,
product rental, loans, leases and other related products and services.

            For the fiscal year ended January 31, 1999, the Company's revenues
were generated from the following areas of business:

               New equipment and truck sales..................... 54%
               Used equipment and truck sales.................... 16%
               Product support (parts and service revenues)...... 25%
               Equipment rental..................................  4%
               Financial services................................  1%


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            The Company, a Delaware corporation, is the surviving entity
resulting from a merger between the Company and RDO Equipment Co., a North
Dakota corporation ("RDO-North Dakota") which was effective January 22, 1997
(the "Merger"). RDO-North Dakota was originally incorporated in North Dakota on
March 13, 1968. The Company's executive offices are located at 2829 South
University Drive, Fargo, North Dakota 58103. The Company's phone number is (701)
297-4288. References to the Company in this report include its subsidiaries and
RDO-North Dakota.

GROWTH STRATEGY

            The key elements of the Company's growth strategy are:

            INCREASING MARKET SHARE. The Company seeks to increase its market
share by enhancing customer service and generating customer loyalty. To
accomplish this objective, the Company offers a broad range of products,
utilizes aggressive marketing programs, trains its employees to have a strong
customer orientation, employs state-of-the-art service equipment, and maintains
a computerized real-time inventory system. Each store offers a broad array of
products based on the nature of that store's customer base. As the installed
base of equipment and trucks expands, the Company has the opportunity to
generate additional parts and service business and trade-ins. The Company's
finance subsidiary also assists in structuring transactions to meet the needs of
its customers. The Company believes that each customer's experience with the
Company's parts and service departments and other value-added services can
positively influence such customer's overall satisfaction. Parts and service,
rental and finance revenues currently have higher profit margins than equipment
and truck sales. The Company also has diversified its business into
complementary fields to serve its customers' needs, expand its customer base,
and enhance its revenues.

            PURSUING ADDITIONAL ACQUISITIONS. Acquisitions are expected to
continue to be an important element of the Company's growth strategy,
particularly given the consolidation trends among equipment and truck retailers.
Due to the Company's leadership position, access to capital and track record in
completing and integrating acquisitions, the Company believes that attractive
acquisition candidates will continue to become available to the Company. The
Company believes that its management team has substantial experience in
evaluating potential acquisition candidates and determining whether a particular
retailer can be successfully integrated into the Company's existing operations,
i.e., whether the operations of an acquisition candidate can be enhanced by
utilizing the Company's operating model and being part of the Company's network
of stores. Upon consummation of each acquisition, the Company integrates the
retailer into its operations by implementing the Company's operating model and
seeks to enhance the acquired retailer's performance within its target market.
Integration of an acquisition generally is completed within the first six to 12
months, although it can take several years before the benefits of the Company's
operating model, store network, strategies and systems are fully realized.
Generally, manufacturers require that their prior approval be given to
prospective acquisitions of their dealerships.

            IMPLEMENTING THE RDO OPERATING MODEL. The Company has developed a
proven operating model designed to improve the performance and profitability of
each of its stores. Components of this operating model include (i) pursuing
aggressive marketing programs, (ii) allowing store employees to focus on
customers by managing administrative functions, training and purchasing at the
corporate level, (iii) providing a full complement of parts and state-of-the-art
service functions, including a computerized real-time inventory system and quick
response, on-site repair service, (iv) motivating store level management in
accordance with corporate goals, and (v) focusing on cost structures at the
store level. The Company implements its operating model in a variety of areas.
For example, the Company is proactive in attracting new customers by sending
targeted direct mailings, hosting open houses and service clinics and


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participating in trade shows. Additionally, the Company centralizes certain
functions such as accounting, marketing, purchasing and employee recruitment,
allowing its store managers and personnel more time to focus on making sales and
providing product support to customers.

            CAPITALIZING ON DIVERSITY OF OPERATIONS. A major focus of the
Company's strategy has been to expand its stores into geographic areas that have
a large base of activity and that provide the Company with opportunities to
continue to develop its store network. The Company has also focused on expanding
into industries in which product distribution is highly fragmented and the
Company's operating model can be implemented. The Company believes that its
business diversification has significantly increased its customer base, while
also mitigating the effects of industry-specific economic cycles. Similarly, the
Company's geographic diversification into regions outside its initial base in
the Midwest helps to diminish the effects of seasonality and weather, as well as
local and regional economic fluctuations.

ACQUISITIONS, STORE OPENINGS AND DEALER APPOINTMENTS IN FISCAL 1999

            During fiscal 1999, the Company made the following acquisitions:

                  *     Volvo truck dealership in Minneapolis/St. Paul,
                        Minnesota which had annual revenues of approximately $12
                        million.

                  *     Mack truck dealership in Minneapolis/St. Paul, Minnesota
                        (and was subsequently consolidated with the Twin Cities
                        Volvo truck operations) which had annual revenues of
                        approximately $35 million.

                  *     Volvo and GMC truck dealerships in Fargo and Grand
                        Forks, North Dakota which had annual revenues of
                        approximately $31 million.

                  *     Agricultural equipment rental business in Salinas,
                        California which had annual revenues of approximately
                        $10 million.

                  *     Material handling equipment business in Grand Island,
                        Lincoln and Omaha, Nebraska and Sioux City, Iowa which
                        had annual revenues of approximately $12 million.

                  *     Construction equipment rental business in Las Vegas,
                        Nevada which had annual revenues of less than $1
                        million.

            In addition, the Company opened new construction equipment rental
stores in Show Low and Tucson, Arizona and Riverside and Temecula, California,
opened a new Vermeer construction equipment store in Minneapolis/St. Paul,
Minnesota, opened a new material handling equipment store in Minneapolis/ St.
Paul, and was appointed a Hyster lift truck dealer for the upper Midwest.

            On February 3, 1999, the Company announced its acquisition of a
Volvo truck dealership with full-service truck centers located in Dallas and Ft.
Worth, Texas. This dealership had annual revenues of approximately $33 million.


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CONSTRUCTION EQUIPMENT OPERATIONS

            The Company estimates that North American retail sales of new
construction equipment in its target product market (light to medium
applications) in calendar 1998 totaled over $6 billion. Deere is one of the
leading suppliers of construction equipment in North America for light to medium
applications and offers a broad array of products. Currently, the Company
believes Deere has approximately 100 construction dealers which operate
approximately 420 main stores and sales and service centers in North America.
Each dealer within the Deere construction dealer system is assigned designated
geographic areas of responsibility within which it has the right to sell new
Deere construction products.

            The Company believes it is the largest Deere construction equipment
dealer in North America, both in number of stores and total purchases,
accounting for approximately seven percent of Deere's North American
construction equipment sales in calendar 1998. As of the end of fiscal 1999, the
Company operated 25 Deere construction equipment stores located in metropolitan
areas in Arizona, Southern California, Minnesota, Montana, North Dakota, South
Dakota and Central Texas.

            Customers of the Company's construction equipment stores are diverse
and include contractors, for both residential and commercial construction,
utility companies, and federal, state and local government agencies. The
Company's stores provide a full line of equipment for light to medium size
applications and related product support to their customers. Primary products
include John Deere backhoes, excavators, crawler dozers and four-wheel-drive
loaders. The Company's construction equipment stores also offer complementary
equipment from other suppliers, as well as used equipment primarily taken as
trade-ins.

            The Company's construction equipment stores are located in areas
with significant construction activity, including Austin, Dallas/Fort Worth,
southeastern Los Angeles, Minneapolis/St. Paul, Phoenix, San Antonio and San
Diego. Each construction equipment store displays a broad array of new and used
equipment and has a series of fully-equipped service bays to provide on-site
service and maintenance of construction equipment. The Company believes it has a
competitive advantage over other construction equipment dealers given its
ability to draw on its network of construction stores for equipment and parts,
the focus on used equipment and the economies of scale inherent in its
centralized administrative, purchasing and inventory management functions.

CONSTRUCTION EQUIPMENT RENTAL OPERATIONS

            The Company estimates that the North American construction equipment
rental industry was over $15 billion in calendar 1998 with over 15,000 equipment
rental companies. The growth in this industry is being driven primarily by
construction and industrial companies that are increasingly outsourcing their
equipment needs to reduce their investment in non-core assets and to convert
equipment costs from fixed to variable.

            The Company maintains a rental fleet of construction equipment
(ranging from hand-held items to excavators), primarily through its 13 RDO
Rental Co. equipment rental stores located in Arizona, Nevada and Southern
California. The Company rents construction equipment to customers on a
short-term basis, generally for a specified number of days or weeks, at
competitive rates. The Company believes that its rental operations will continue
to benefit from the trend among businesses to outsource operations, including
equipment ownership, in order to minimize their capital investment in equipment
as well as reducing or eliminating the down-time, maintenance, repair and
storage costs associated with equipment ownership. Used rental equipment is then
sold by the Company, generally after 36 to 48 months of service. The Company
believes that the rental business will be an area of growth for it as the
Company expands its


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operations in Arizona, Nevada and California, as well as in its Midwest and
Texas operations. The Company believes that its network of construction
equipment stores support the sale of the used equipment retired from its rental
fleet through the ability to relocate used equipment to various geographic
regions based on market demand, the access to an expanded customer base, and the
availability of trained personnel to service the used equipment to enhance its
resale value.

AGRICULTURE OPERATIONS

            The Company estimates that North American retail sales of new
agricultural equipment in its target product market in calendar 1998 totaled
over $10 billion. Deere is the leading supplier of agricultural equipment in
North America. Within the Deere agricultural dealer system, dealers are not
assigned exclusive territories, but are authorized to operate at specific store
locations. Currently, the Company believes Deere has approximately 1,200
agricultural dealers which operate approximately 1,700 stores in North America.

            The Company believes it is the largest Deere agricultural equipment
dealer in North America, both in number of stores and total purchases,
accounting for approximately 1.7 percent of Deere's North American agricultural
sales in calendar 1998. As of the end of fiscal 1999, the Company operated 15
Deere agricultural equipment stores located in Arizona, Southern California,
Minnesota, North Dakota, South Dakota and Washington.

            The Company's agricultural equipment stores are a full-service
supplier to farmers, offering a broad range of farm equipment and related
products for the crops grown in each of their areas. As a result of the customer
mix and Deere's product offering, the core products include combines, tractors,
planting equipment and tillage equipment. The Company's agricultural equipment
stores also carry other harvesting and crop handling machinery, as well as lawn
and grounds care equipment. The sale of new Deere agricultural equipment is the
primary focus of the Company's agricultural equipment sales and accounts for a
majority of new equipment sales. A wide variety of additional agricultural
equipment lines, which complement the Deere products, is also offered according
to local market demand. The agricultural stores also sell used equipment,
generally acquired as trade-ins.

            The agricultural equipment stores are located in areas with
significant concentrations of farmers and typically serve customers within a 25
to 50 mile radius. Each store displays a broad array of new and used equipment
and has fully-equipped service bays to provide on-site service and maintenance
of agricultural equipment. The Company believes it has a competitive advantage
over other agricultural dealers given its ability to draw on its network of
agricultural stores for equipment and parts, the focus on used equipment and the
economies of scale inherent in its centralized administrative, purchasing and
inventory management functions.

            The Company also conducts an agricultural equipment rental business
in California which it acquired during fiscal 1999. The Company believes that
the agricultural equipment rental business is a growing trend for many of the
same factors driving the growth in construction equipment rental, especially in
the western, southwestern and south central regions of the United States. The
Company believes that its dealerships and rental operations complement and
support each other.

            In October 1998 the Company announced plans to exit the agricultural
irrigation equipment business and its store located in Wadena, Minnesota. These
assets were subsequently sold in November 1998.


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TRUCK OPERATIONS

            The Company estimates that North American retail sales of heavy-duty
trucks in calendar 1998 exceeded $10 billion. Mack Trucks, Inc. and Volvo AB are
leading suppliers of heavy-duty trucks in North America. Mack has approximately
190 dealers which operate approximately 260 stores in North America, while Volvo
has approximately 160 dealers which operate approximately 160 stores in North
America. Each Mack or Volvo truck dealer is assigned designated geographical
areas of responsibility within which it has the right to sell new trucks made by
the truck manufacturer.

            The Company operates Mack truck centers in Minneapolis/St. Paul,
Minnesota and in Fargo and Grand Forks, North Dakota. Its Volvo truck centers
are located in Minneapolis/St. Paul, Minnesota, in Fargo and Grand Forks, North
Dakota, and in Dallas and Ft. Worth, Texas. The Company's truck centers in
Fargo, Grand Forks, Dallas and Ft. Worth also sell and service GMC trucks, and
its stores in Fargo and Grand Forks also handle Isuzu trucks. The Company's
truck centers are located in high truck traffic areas on or near major highways.

            Trucks sold by the Company are generally classified as "Class 8" by
the American Automobile Manufacturers Association (a minimum gross vehicle
weight rating above 33,000 pounds). They are primarily used for over-the-road
and off-highway transportation of general freight and various vocational
applications including the hauling of construction materials, logging, mining,
petroleum, refuse, waste and other specialty uses. Customers generally purchase
these trucks for commercial purposes which are outfitted to perform according to
the user's specifications.

            The Company's truck centers display a broad array of new and used
trucks and have fully-equipped service bays to provide on-site service and
maintenance of trucks, including body shops. The Company believes its operating
model gives it a competitive advantage over other truck dealers. In addition,
its truck operations and construction equipment operations have common customers
which presents opportunities for marketing, selling and operating synergies.

MATERIAL HANDLING OPERATIONS

            The Company estimates that North American retail sales of lift
trucks and other material handling equipment in its target product market in
calendar 1998 exceeded $5 billion. Hyster Company (part of the material handling
group of NACCO Industries, Inc.) is a leading supplier of lift trucks in North
America. Hyster has approximately 50 dealers which operate approximately 100
stores in North America. Each Hyster dealer is assigned designated geographical
areas of responsibility within which it has the right to sell new Hyster lift
trucks and parts. During fiscal 1999, the Company was appointed a Hyster lift
truck dealer for the upper Midwest - Minnesota, Nebraska, North Dakota, South
Dakota, western Iowa and northwestern Wisconsin.

            Hyster lift trucks (also referred to as forklift trucks or
forklifts) are used in a wide variety of business applications, including
manufacturing and warehousing. The principal categories of lift trucks include
electric rider, electric narrow-aisle and electric-motorized hand forklift
trucks primarily for indoor use and internal combustion engine forklift trucks
for indoor or outdoor use.

            Shortly after its appointment as a Hyster dealer in fiscal 1999, the
Company acquired the operating assets of two companies engaged in the
distribution, sale, service and rental of material handling equipment with
stores located in Grand Island, Lincoln and Omaha, Nebraska and Sioux City,
Iowa. This acquisition provided the Company with an established platform which
complemented its Hyster operations,


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including aerial and high-reach man lifts manufactured by Genie, Grove, Skyjack
and Upright and other equipment used to move, protect, store or control products
and materials in manufacturing and distribution.

            The Company conducts its material handling operations from 11
locations in the upper Midwest of which five locations are dedicated solely to
material handling equipment. The other locations consist of several of the
Company's agricultural and construction equipment stores in Minnesota and North
Dakota. Each store displays a broad array of equipment for sale or rent, and has
fully-equipped service bays to provide on-site service and maintenance.
Customers include commercial, manufacturing, trucking and warehousing
businesses, some of which have fleets of material handling equipment to be
maintained. The Company believes its operating model gives it a competitive
advantage over other material handling equipment retailers, and that its other
operations have common customers with its material handling operations which
presents opportunities for marketing, selling and operating synergies.

USED EQUIPMENT AND TRUCKS

            The Company believes that an integral part of its operations is the
handling of used equipment and trucks. Accordingly, the Company has established
a division which assists in the valuation of used products which the Company
receives in trade-ins, assists in the purchase of used products for sale or rent
by its dealership and rental operations, and supports the sale of used products
received as trade-ins or retired from its rental operations. This division also
actively purchases and remarkets on the open market used equipment manufactured
by companies other than Deere such as Caterpillar Inc. ("Caterpillar"), Komatsu
Corporation ("Komatsu") and Volvo AB. The Company's used equipment division
primarily operates in North America, and is expanding its international
activities into Europe and South America.

PARTS AND SERVICE

            The Company's stores offer a broad range of replacement parts and
fully-equipped service and repair facilities for their respective product lines.
The Company believes that product support through parts and service will be
increasingly important to its ability to attract and retain customers for its
operations. Each store includes service bays staffed by highly trained service
technicians. Technicians are also available to make on-site repairs of equipment
that cannot be brought in for service. The Company's service technicians receive
training from Deere and certain other suppliers, as well as additional on-site
training conducted by the Company. The construction equipment stores located in
Dallas, Texas; Minneapolis, Minnesota; and Riverside, California also operate
undercarriage shops for all makes and sizes of crawler equipment.

FINANCIAL SERVICES

            The Company's finance subsidiary, RDO Financial Services Co.,
provides equipment and truck loans and leases to the customers of the Company's
retail network. In fiscal 1999, this subsidiary developed strategic partnerships
with vendors of financial products, as well as additional services such as
revolving credit, farm land financing, extended warranties, credit life
insurance and casualty insurance, which are sold to the Company's customers.

            The Company believes that there is a growing trend in the equipment
and truck distribution business toward selling new and used products with
financing and service contracts. In addition, financing incentives are becoming
an important element in the Company's selling efforts. Customers are
increasingly wanting to purchase products from retailers who can also provide
financing and other products and services of the types being offered by the
Company.


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INVENTORY AND ASSET MANAGEMENT

            The Company maintains substantial inventories of equipment, trucks
and parts in order to facilitate sales to customers on a timely basis. The
Company also is required to build its inventory of agricultural equipment and
parts in advance of its second and third fiscal quarters, which historically
have higher sales, to ensure that it will have sufficient inventory available to
meet the needs of its agricultural customers and to avoid shortages or delays.

            The Company maintains a database on sales and inventory, and has a
centralized real-time inventory control system. This system enables each store
to access the available inventory of the Company's other stores before ordering
additional items from the supplier. As a result, the Company minimizes its
investment in inventory while effectively and promptly satisfying its customers'
needs. Using this system, the Company also monitors inventory levels and mix in
its network and at each store and makes adjustments as needed in accordance with
its operating plan.

INVENTORY FINANCING

            Having adequate equipment, trucks and parts inventories at each of
the Company's stores is important to meeting its customer needs and to its
sales. Accordingly, the Company attempts to maintain at each store, or have
readily available at other stores in its network, sufficient inventory to
satisfy anticipated customer needs. Inventory levels fluctuate throughout the
year and tend to increase before the primary sales seasons for agricultural
equipment. The cost of financing its inventory is an important factor affecting
the Company's results of operations. In its truck segment, the cost of floor
plan financing of truck inventories has a direct relationship to the volume of
retail loans and leases originated on behalf of the floor plan supplier.

            Floor plan financing from Deere, Deere Credit Services, Inc. ("Deere
Credit")and NationsBanc Leasing Corporation ("NationsBanc") represents the
primary source of financing for equipment inventories, particularly for
equipment supplied by Deere. Floor plan financing of truck inventories is
primarily supplied by Associates Commercial Corporation ("Associates"), General
Motors Acceptance Corporation ("GMAC") and Volvo Commercial Finance LLC The
Americas. Rental equipment financing is primarily provided by Associates,
Deutsche Financial Services Corporation ("Deutsche") and Deere Credit. All
lenders generally receive a security interest in the inventory or rental
equipment being financed.

CUSTOMER FINANCING OPTIONS

            Financing options for customer purchases support the sales
activities of the Company. Financing for purchases by the Company's customers
are available through programs offered by the Company's finance subsidiary, by
manufacturer-sponsored sources (such as Deere Credit) and by major finance
companies (such as Associates). The Company's finance subsidiary coordinates
arrangements for most of the Company's customers who request financing. The
Company does not grant extended payment terms.

PRODUCT WARRANTIES

            Warranties for new products and parts are generally provided by the
manufacturer. The term and scope of these warranties vary greatly by
manufacturer and by product. The Company does not


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provide additional warranties to retail purchasers of new products. The
manufacturer (such as Deere) pays the Company for repairs to equipment under
warranty. The Company generally sells used products "as is" and without
manufacturer's warranty, although manufacturers sometimes provide limited
warranties if the manufacturer's original warranty is transferable and has not
yet expired. The Company also sells a warranty product offered by Deere on new
and used equipment. The Company itself has not generally provided additional
warranties.

COMPETITION

            The Company's construction equipment stores compete with
distributors of equipment produced by manufacturers other than Deere, including
Case Corporation ("Case"), Caterpillar and Komatsu. The Company also faces
competition from distributors of manufacturers of specific types of construction
equipment, including JCB backhoes, Kobelco excavators, Komatsu wheel loaders and
crawler dozers, and Bobcat skid loaders. The Company's agricultural equipment
stores compete with distributors of equipment from suppliers other than Deere,
including Agco Corporation, Case, Caterpillar and New Holland N.V., a subsidiary
of Fiat. The Company's agricultural equipment stores also compete with other
Deere agricultural dealerships. Competing Deere agricultural stores may be
located in close proximity to one of the Company's agricultural equipment
stores.

            The Company's equipment rental stores compete with other equipment
rental companies, including equipment dealers. Equipment rental businesses
generally make available for short-term rent used equipment manufactured by the
foregoing manufacturers, including those who are suppliers to the Company.

            The Company's truck centers compete with distributors of trucks
produced by manufacturers other than Mack and Volvo, including DaimlerChrysler
AG (Freightliner and Sterling), Ford Motor Co., Navistar International Corp. and
Paccar Inc. (Peterbilt and Kenworth). The Company's material handling stores
compete with distributors of lift trucks produced by manufacturers other than
Hyster, including Clark Material Handling Company, Crown Equipment Corporation,
Nissan Motor Co., Toyota Motor Corp. and another division of the NACCO material
handling group (Yale), and with other equipment rental companies which rent
aerial and high-reach man lifts, lift trucks and other material handling
equipment.

            Competition among equipment and truck retailers is primarily based
on price, value, reputation, quality, design and performance of the products
offered by the retailer, the customer service and product servicing provided by
the retailer, and the accessibility of the retailer's stores. The Company
believes that its store locations, broad product lines, quality products,
product support and other customer and financial services enable it to compete
effectively.

BACKLOG

            The Company's truck operations sell approximately two-thirds of
their new heavy-duty trucks by customer order, with the remainder sold out of
inventory. The general time period from order placement to delivery is currently
three to eight months. At January 31, 1999, the Company's backlog of confirmed
truck orders (including orders from fleet customers who typically place orders
up to one year in advance of scheduled delivery dates) was approximately $41.4
million. The Company expects to fill all of these orders during fiscal 2000.


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DEALERSHIP AGREEMENTS

            DEERE CONSTRUCTION DEALER AGREEMENTS. The Company has agreements
with Deere which authorize the Company to act as a dealer of Deere construction,
utility and forestry equipment (the "Construction Dealer Agreements"). The
Company's areas of responsibility for the sale of Deere construction equipment
are: (i) in the Midwest: almost all of Minnesota, Montana, North Dakota and
South Dakota, and small portions of Iowa and Wyoming; (ii) in the Southwest:
Arizona and part of Southern California; and (iii) in the South Central: Central
Texas, including the Austin, Dallas-Fort Worth and San Antonio metropolitan
areas.

            Pursuant to the Construction Dealer Agreements, the Company is
required, among other things, to maintain suitable facilities, provide competent
management, actively promote the sale of construction equipment in the
designated areas of responsibility, fulfill the warranty obligations of Deere,
maintain inventory in proportion to the sales potential in each area of
responsibility, provide service and maintain sufficient parts inventory to
service the needs of its customers, maintain adequate working capital, and
maintain stores only in authorized locations. Deere is obligated to make
available to the Company any finance plans, lease plans, floor plans, parts
return programs, sales or incentive programs or similar plans or programs it
offers to other dealers. Deere also provides the Company with promotional items
and marketing materials prepared by Deere for its construction equipment
dealers. The Construction Dealer Agreements also entitle the Company to use John
Deere trademarks and tradenames, with certain restrictions.

            DEERE AGRICULTURAL DEALER AGREEMENTS. The Company has non-exclusive
dealership agreements with Deere for each of its Deere agricultural equipment
stores, each of which authorizes the Company to act as a dealer in Deere
agricultural equipment (the "Agricultural Dealer Agreements") at a specific
authorized store location. The terms of the Agricultural Dealer Agreements are
substantially the same as the Construction Dealer Agreements. The Deere
agricultural equipment stores also offer John Deere lawn and grounds equipment,
for which the Company has entered into non-exclusive Lawn and Garden Dealer
Agreements containing substantially the same terms as the Agricultural Dealer
Agreements.

            DEERE DEALERSHIP AGREEMENTS - OTHER PROVISIONS. Under an agreement
with Deere, the Company cannot engage in discussions to acquire other Deere
dealerships without Deere's prior written consent, which Deere may withhold in
its sole discretion. In addition, Deere has the right to have input into the
selection of Company's management personnel, including managers of the Company's
Deere equipment stores, and to have input with respect to the selection of
nominees to the Company's Board of Directors and the removal of directors. The
prior consent of Deere is required for the opening of any Deere equipment store
within the Company's designated areas of responsibility and for the acquisition
of any other Deere dealership. In addition, without the consent of Deere, the
Company is prohibited from making acquisitions, initiating new business
activity, paying dividends, repurchasing its capital stock, or making any other
distributions to stockholders if the equity-to-assets ratio of the Company's
Deere dealerships is below 30%, as calculated by Deere under the agreement, or
if such ratio would fall below 30% as a result of such action. As of the end of
fiscal 1999, the Company has calculated the equity-to-assets ratio of the
Company's Deere dealerships to be 31%. In the event of Mr. Offutt's death, Deere
has the right to terminate the Company's dealer appointments upon the occurrence
of a "change of control."

            The Company's Deere dealer appointments are not exclusive. Deere
could appoint other dealers in close proximity to the Company's existing stores.
The areas of responsibility assigned to the Company's construction equipment
dealerships can be reduced by Deere upon 120 days prior written notice. In
addition, the dealer agreements can be amended at any time without the Company's
consent, so long as the


                                       11
<PAGE>


same amendment is made to the dealer agreements of all other Deere dealers.
Deere also has the right to sell directly to federal, state or local
governments, as well as national accounts. To the extent Deere appoints other
dealers in the Company's markets, reduces the areas of responsibility relating
to the Company's construction equipment stores, or amends the dealer agreements
or directly sells substantial amounts of equipment to government entities and
national accounts, the Company's results of operations and financial condition
could be adversely affected.

            VOLVO AGREEMENTS. In May 1998, the Company and Volvo announced a
framework arrangement under which the Company is expanding its presence in
Volvo's truck distribution system by acquiring additional dealer locations as
well as being awarded franchises for locations where no Volvo dealer exists.
This arrangement includes financing and other assistance from Volvo to assist in
acquiring, opening and operating Volvo truck dealership locations. Financing
from Volvo is forgiven or repaid based upon the performance of a dealership
after the Company acquires or opens it.

            Under its dealer agreements with Volvo, the Company is an
authorized, exclusive retail dealer of new Volvo trucks and parts in the
territories around its Volvo truck centers. The Company is required, among other
things, to meet sales, service and facilities criteria established by Volvo and
to maintain appropriate inventories of trucks and parts. The Company must also
provide Volvo with financial and planning documents on a regular basis and
provide warranty repairs on covered Volvo trucks. The Company is granted the
right to use various Volvo trademarks in the conduct of its business and the
benefit of Volvo materials and training.

            Volvo dealer agreements generally provide for an initial term of up
to five years, and are extended annually. It is Volvo's stated objective that
dealer agreements continue in effect indefinitely so long as the Company
satisfies its obligations and meets its objectives. Volvo may terminate a dealer
agreement upon the occurrence of a material breach enumerated in the agreement
which are typical of dealership agreements generally. Volvo also can reduce or
change the scope of the territories associated with the Company's Volvo truck
dealerships.

            OTHER SUPPLIERS. The Company is an authorized dealer at various
stores for suppliers of other products. The terms of such arrangements vary, but
most of the dealership agreements contain termination provisions allowing the
supplier to terminate the agreement after a specified notice period (usually 180
days), upon a change of control, and in the event of Mr. Offutt's death.

INTELLECTUAL PROPERTY RIGHTS

            RDO Equipment Co. is a registered service mark owned by the Company.
John Deere is a registered trademark of Deere & Company, the Company's use of
which is authorized under the Deere dealership agreements. Trademarks and
tradenames with respect to new equipment and trucks obtained from manufacturers
other than Deere are licensed from their respective owners. The Company
historically has operated each of its dealerships under either the RDO Equipment
Co. service mark and tradename or, for purposes of continuity at a particular
store if there was strong local name recognition and customer loyalty, the name
historically used by the dealership in that location. Each dealership store is
generally identified as an authorized dealer or representative of the
manufacturer or manufacturers of the equipment, trucks or other products sold at
the store, and may also display signs of other suppliers.


                                       12
<PAGE>


ENVIRONMENTAL AND GOVERNMENTAL REGULATIONS

            The Company's operations are subject to numerous federal, state and
local rules and regulations, including laws and regulations designed to regulate
workplace health and safety, to protect the environment and to regulate the
discharge of materials into the environment, primarily relating to its service
operations. Based on current laws and regulations, the Company believes that it
is in compliance with such laws and regulations and that its policies, practices
and procedures are designed to prevent unreasonable risk of environmental damage
or violation of environmental laws and regulations and any resulting material
financial liability to the Company. The Company is not aware of any federal,
state or local laws or regulations that have been enacted or adopted, the
compliance with which would have a material adverse effect on the Company's
results of operations or would require the Company to make any material capital
expenditures. No assurance can be given that future changes in such laws or
regulations or changes in the nature of the Company's operations or the effects
of activities of prior occupants or activities at neighboring facilities will
not have an adverse impact on the Company's operations.

            The Company's truck operations are subject to the National Traffic
and Motor Vehicle Safety Act, Federal Motor Vehicle Safety standards promulgated
by the U.S. Department of Transportation and various state motor vehicle
regulatory agencies. State and local laws and regulations require each truck
dealership to obtain licenses to operate as a dealer in heavy-duty vehicles. The
Company believes that its truck operations are in compliance with all federal,
state and local laws and regulations and that it has obtained all necessary
licenses and permits.

            The Company's financial services operations are subject to laws and
regulations with respect to financing, commercial finance regulations that may
be similar to consumer finance regulations in some states, including those
governing interest rates and charges, maximum amounts and maturities of credit
and customer disclosure of transaction terms. The Company's insurance products
and services are subject to laws and regulations with respect to insurance,
licensing, insurance premiums, financing rates and insurance agencies. The
Company believes that it is in compliance with these laws and regulations.

EMPLOYEES

            As of January 31, 1999 the Company employed 1,554 full-time
employees. Of this number, 25 employees were located at the Company's corporate
offices and employed in corporate administration. The remaining employees were
involved in the Company's operations: 785 in construction operations, 363 in
agriculture operations, 171 in truck operations, 173 in rental operations and 37
in financing and related services. None of the Company's employees are covered
by a collective bargaining agreement.

CERTAIN IMPORTANT FACTORS

            In addition to the matters discussed above, there are important
factors that could cause the Company's future results to differ materially from
those anticipated by the Company or which are reflected in any forward-looking
statement which may be made by or on behalf of the Company. Many of these
important factors are identified and discussed in greater detail in the
Company's Form 8-K dated April 23, 1999, and in other filings with the
Securities and Exchange Commission (the "SEC"). Some of these important factors
(but not necessarily all important factors) include the following:

            a.    General economic conditions worldwide and locally, including
                  agricultural industry cycles, construction spending, federal,
                  state and local government spending on highways and other
                  construction projects, housing starts, interest rates, fuel
                  prices, currency exchange rates,


                                       13
<PAGE>


                  customer business cycles, climatic phenomena such as La Nina
                  and El Nino, and customer confidence in the economy;

            b.    The length of the crop growing season, farm cash income,
                  farmer debt levels, adverse weather, animal and plant
                  diseases, crop pests, harvest yields, world grain stocks,
                  commodity prices, real estate values, government farm
                  programs, and the confidence of the Company's agricultural
                  customers in the farm economy;

            c.    Changes in governmental regulations, and legislation primarily
                  relating to agriculture, the environment, commerce and
                  government spending on infrastructure;

            d.    The positions of Deere and other manufacturers with respect to
                  publicly traded dealers, dealer consolidations and specific
                  acquisition opportunities;

            e.    The overall success of Deere and the Company's other
                  suppliers;

            f.    The manufacture and delivery of competitively-priced, high
                  quality equipment, trucks and parts by the Company's suppliers
                  in quantities sufficient to meet the requirements of the
                  Company's customers on a timely basis;

            g.    The incentive and discount programs provided by Deere and the
                  Company's other suppliers, and their promotional and marketing
                  efforts for the Company's products;

            h.    The introduction of new and innovative products by the
                  Company's suppliers;

            i.    Capital needs of the Company and the status of markets for
                  equity and debt financing;

            j.    The availability and terms of floor plan, customer and other
                  financing;

            k.    Risks associated with growth, expansion and acquisitions,
                  including the management of growth;

            l.    Integration and successful operation of acquired businesses;

            m.    Securitization transactions and other financing arrangements
                  relating to the Company's financial services operations,
                  including credit availability and customer credit risks;

            n.    Availability, sufficiency and cost of insurance;

            o.    Operating and financial systems to manage rapidly growing
                  operations;

            p.    Potential impact on the Company and its suppliers of the year
                  2000 on processing date-sensitive information; and

            q.    Continued availability of key personnel.


                                       14
<PAGE>


ITEM 2.     PROPERTIES.

            As of the end of fiscal 1999, the Company owned the real estate for
nine of its stores, leased its executive offices and 23 stores from an Offutt
Entity (as defined in Item 4A below), leased an administrative office and six
stores from other related parties, and leased three administrative offices and
26 stores from unrelated third parties. Lease terms range from one to 11 years
and some leases include an option to purchase the leased property. The Company
believes that all of its facilities are in good operating condition.


ITEM 3.     LEGAL PROCEEDINGS.

            There are no material pending legal, governmental, administrative or
other proceedings to which the Company is a party or of which any of its
property is the subject.


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

            None.


ITEM 4A.    EXECUTIVE OFFICERS OF THE REGISTRANT.

            The executive officers of the Company, their ages and offices held
are as follows:

NAME                  AGE     OFFICE
----                  ---     ------

Ronald D. Offutt      56      Chairman of the Board and Chief Executive Officer

Paul T. Horn          56      President and Chief Operating Officer

Allan F. Knoll        55      Secretary

Thomas K. Espel       40      Chief Financial Officer

Richard J. Moen       51      Chief Administrative Officer and Treasurer

Charles Calhoun       46      Executive Vice President - Used Equipment Division

Steven B. Dewald      38      Senior Vice President - RDO Financial Services Co.

H. David Frambers     55      Executive Vice President - Emerging Divisions

William R. Hutton     51      President - RDO Rental Co.

Mark A. Doda          36      Senior Vice President and Controller

-------------------


                                       15
<PAGE>

            RONALD D. OFFUTT is the Company's founder, Chairman, Chief Executive
Officer and principal stockholder. He has served as a member of the Company's
Office of the Chairman since December 1998, and served as President of the
Company from its formation in 1968 until August 1996. Mr. Offutt also serves as
Chief Executive Officer and Chairman of the Board of R.D. Offutt Company
("Offutt Co.") and other entities he owns, controls or manages (collectively,
the "Offutt Entities") which are engaged in a variety of businesses such as
farming, food processing, auto dealerships and agricultural financing
activities, some of which transact business with the Company. Mr. Offutt spent
approximately one-half of his time on business of the Company during fiscal
1999. He serves on the Board of Directors of High Plains Corporation, an ethanol
producer based in Wichita, Kansas. Mr. Offutt is Chairman of the Board of
Regents of Concordia College of Moorhead and is a graduate of Concordia College
of Moorhead with a degree in Economics. Mr. Offutt is the brother-in-law of
Larry E. Scott, the Company's Senior Vice President - Southwest Construction
Division and the father of Christi J. Offutt, the Company's Vice President -
Strategic Development.

            PAUL T. HORN has served as a member of the Company's Office of the
Chairman since December 1998, as President of the Company since August 1996, and
as Chief Operating Officer and a director of the Company since 1986. Prior to
October 1, 1996, he was an employee of Offutt Co. and spent approximately
one-fourth of his time on the business of the Company. Since such date, he has
been an employee of the Company and has spent substantially all of his time on
the business of the Company. Mr. Horn serves as a director and officer and is a
beneficial stockholder of many of the Offutt Entities. Mr. Horn currently serves
as Vice Chairman of the Board of Directors of Northern Grain Company, a regional
grain elevator. Mr. Horn is a graduate of Michigan State University with degrees
in Business Administration and Agronomy.

            ALLAN F. KNOLL has served as a member of the Company's Office of the
Chairman since December 1998, and as Secretary and a director of the Company
since 1974. He served as Chief Financial Officer of the Company from 1974
through January 1999. Mr. Knoll also serves as Chief Financial Officer and
Secretary of Offutt Co., and serves as a director and officer and is a
beneficial stockholder of many of the Offutt Entities. Mr. Knoll spent
approximately two-thirds of his time on the business of the Company during
fiscal 1999. Mr. Knoll is a graduate of Moorhead State University with degrees
in Business Administration and Accounting.

            THOMAS K. ESPEL has served as Chief Financial Officer since February
1999. He previously served as Executive Vice President - Finance since August
1998. Prior to joining the Company, he served as manager of Ag Capital Company
since its inception in 1989 and continues to serve as a member of its Board of
Directors. Under his direction, Ag Capital, an affiliate of R.D. Offutt Company,
grew to more than $450 million in assets managed. RDO Financial Services Co., a
subsidiary of the Company, was formed from the retail credit activities of Ag
Capital. From 1981 through 1988, Mr. Espel held various lending positions at St.
Paul Bank for Cooperatives, a $4 billion institution located in St. Paul,
Minnesota. He has a bachelor's degree from the University of Illinois and a
master's degree from Michigan State University, both in Agricultural Economics -
Finance.

            RICHARD J. MOEN has served as Chief Administrative Officer and
Treasurer of the Company since October 1996. Prior to joining the Company, from
August 1993 until September 1996, Mr. Moen served as Vice President--Legal
Services of ConAgra Diversified Products Companies, a division of ConAgra, Inc.
("ConAgra"), a diversified international food company. From March 1988 until
August 1993, Mr. Moen served as Executive Vice President--Administration,
General Counsel, Secretary and a director of Golden Valley Microwave Foods,
Inc., a company specializing in food products designed for


                                       16
<PAGE>


use in microwave ovens. Mr. Moen is a graduate of Massachusetts Institute of
Technology, with a degree in Economics, and of Harvard Law School.

            CHARLES CALHOUN has served as Executive Vice President - Used
Equipment Division since December 1998. He previously served as Senior Vice
President - Used Commercial Equipment Division since March 1997. Prior to
joining the Company, he was Vice President and an owner of the construction
dealership in Texas which was acquired by the Company in July 1996. Subsequent
to this acquisition and prior to his appointment as Senior Vice President, Mr.
Calhoun managed the Texas construction dealership and started the Used
Construction Equipment Division. He has over 20 years of experience in the
construction equipment business, and is a graduate of Texas Tech University with
a degree in Marketing.

            STEVEN B. DEWALD has served as Senior Vice President - RDO Financial
Services Co. since December 1997. From September 1996 through November 1997, he
served as Director of Finance of Ag Capital Company, an Offutt Entity. Prior to
joining Ag Capital, from February 1995 to August 1996, Mr. Dewald managed
personal investments, including real estate development and fast food
restaurants. From 1989 until February 1995, he held increasingly responsible
positions as a financial officer of Metropolitan Financial Corporation, a
regional thrift holding company acquired in 1995 by U.S. Bancorp (formerly First
Bank System, Inc.) at which time he was serving as Executive Vice President and
Chief Financial Officer. Mr. Dewald worked for Ernst & Young from 1983 to 1989.
He is a graduate of Concordia College of Moorhead with a degree in Accounting
and Healthcare Finance.

            H. DAVID FRAMBERS has served as Executive Vice President - Emerging
Divisions since December 1998. He previously served as Senior Vice President -
Midwest Construction Division since July 1996 and from July 1996 until March
1997 also served as Senior Vice President - South Central Construction Division.
With the expansion of the Construction Division, he became Vice President and
General Manager of the Construction Division for the Midwest and Southwest
regions and held such position from 1991 to July 1996. Mr. Frambers served as
Vice President and General Manager of the Agricultural and Construction
Divisions from 1986 to 1991. Prior to joining the Company, he was the manager of
a Deere agricultural dealership in Grand Forks, North Dakota from 1979 to 1986.
From 1968 to 1979 he was employed by Deere in sales and marketing and held
positions as the territory manager based in Denver, Colorado, the store manager
at Fargo Implement, Fargo, North Dakota, and a division sales manager for Deere
in Minneapolis, Minnesota. He is a graduate of Kansas State College with a
degree in Industrial Technology.

            WILLIAM R. HUTTON has served as President of RDO Rental Co., an 80%
owned subsidiary of the Company, since March 1997. He is also the President of
W.R. Hutton & Associates, Inc., a private investment firm with offices in
Arizona, which owns the remaining 20% of RDO Rental Co. From 1984 until February
1997, he was President and owner of Sun Valley Equipment Corp., the Arizona
construction equipment rental business acquired by RDO Rental Co. in February
1997. From 1977 to 1980, Mr. Hutton was Vice President and one of the founders
of Sunstate Equipment Corp. From 1971 to 1977, Mr. Hutton was a regional manager
for U.S. Rentals, Inc. He attended Glendale Community College.

            MARK A. DODA has served as Senior Vice President and Controller
since December 1998. He previously served as Controller since September 1992.
Prior to joining the Company, Mr. Doda served as a Division Controller for
Graco, Inc., a manufacturer of fluid handling systems, from January 1992 to
September 1992. From 1985 through 1991, Mr. Doda worked for Deloitte & Touche
LLP. Mr. Doda is a graduate of the University of North Dakota with a degree in
Accounting.

                                       17
<PAGE>


                                     PART II

ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
            MATTERS.

            The information under the captions "Common Stock Information" and
"Dividend Policy" on page 38 of the 1999 Annual Report is incorporated herein by
reference. The Company did not have any unregistered sales of equity securities
during fiscal 1999.


ITEM 6.     SELECTED FINANCIAL DATA.

            The information under the caption "Selected Financial Data" on page
13 of the 1999 Annual Report is incorporated herein by reference.


ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS.

            The information under the caption "Management's Discussion and
Analysis of Financial Condition and Results of Operations" on pages 14 through
19 of the 1999 Annual Report is incorporated herein by reference.

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

            The Company is exposed to market risk from changes in interest
rates. Market risk is the potential loss arising from adverse changes in market
rates and prices such as interest rates. For fixed rate debt, interest rate
changes affect the fair value of financial instruments but do not impact
earnings or cash flows. Conversely for floating rate debt, interest rate changes
generally do not affect the fair market value but do impact future earnings and
cash flows, assuming other factors are held constant. A one percentage point
increase in interest rates would result in a net increase to the unrealized fair
market value of the fixed rate debt by approximately $175,000. At January 31,
1999, the Company had variable rate floor plan payables, notes payable and long
term debt of $194.4 million and fixed rate notes payable and long term debt of
$7.2 million. Holding other variables constant, the pre-tax earnings and cash
flow impact for the next year resulting from a one percentage point increase in
interest rates would be approximately $1.9 million.

            The Company's policy is not to enter into derivatives or other
financial instruments for trading or speculative purposes. Consistent with this
policy, the Company's finance subsidiary RDO Financial Services Co. originates
fixed rate loan and fixed payment leases. On a monthly basis, these loans and
leases are sold into a commercial paper conduit which requires interest swaps to
hedge the interest risk.


ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

            The Company's Consolidated Financial Statements and the report of
its independent public accountants, Arthur Andersen LLP, on pages 20 through 36
of the 1999 Annual Report are incorporated herein by reference and are listed in
Item 14(a)(1) on page 20 of this Report. The supplementary data


                                       18
<PAGE>


required by this Item 8 appears as Note 15 entitled "Unaudited Quarterly
Financial Data" on page 35 of the 1999 Annual Report.


ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
            FINANCIAL DISCLOSURE.

            None.


                                    PART III

ITEM 10.    DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

            The information regarding directors under the captions "Election of
Directors--Information About Nominees" and "Election of Directors--Other
Information About Nominees" in the 1999 Proxy Statement is incorporated herein
by reference. Information regarding executive officers is presented in Part I of
this Report as Item 4A.

            The information under the caption "Beneficial Ownership of
Management - Section 16(a) Beneficial Ownership Reporting Compliance" in the
1999 Proxy Statement is incorporated herein by reference.


ITEM 11.    EXECUTIVE COMPENSATION.

            The information under the captions "Election of
Directors--Compensation of Directors" and "Executive Compensation and Other
Benefits" in the 1999 Proxy Statement is incorporated herein by reference.


ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

            The information under the captions "Principal Stockholders" and
"Beneficial Ownership of Management" in the 1999 Proxy Statement is incorporated
herein by reference.


ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

            The information under the caption "Election of Directors - Certain
Relationships and Related Transactions" in the 1999 Proxy Statement is
incorporated herein by reference.


                                       19
<PAGE>


                                     PART IV

ITEM 14.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
            FORM 8-K.

            (a)(1)      FINANCIAL STATEMENTS.

                        The following are incorporated herein by reference from
            the pages indicated in the 1999 Annual Report, copies of which are
            included as Exhibit 13.1 to this Report:

                        Report of Independent Public Accountants--Arthur
                        Andersen LLP--page 36.

                        Consolidated Statements of Operations for the Years
                        Ended January 31, 1999, 1998 and 1997--page 20.

                        Consolidated Balance Sheets as of January 31, 1999 and
                        1998--page 21.

                        Consolidated Statements of Stockholders' Equity for the
                        Years Ended January 31, 1999, 1998 and 1997--page 22.

                        Consolidated Statements of Cash Flows for the Years
                        Ended January 31, 1999, 1998 and 1997--page 23.

                        Notes to Consolidated Financial Statements--pages 24 to
                        35.

            (a)(2)      FINANCIAL STATEMENT SCHEDULES.

                        Schedule II, Valuation and Qualifying Accounts for the
            Year Ended January 31, 1999, is included in this Report at page 22,
            including Report of Independent Public Accountants.

                        All other financial statement schedules are omitted
            because of the absence of the conditions under which they are
            required or because the information required is included in the
            consolidated financial statements or notes thereto.

            (a)(3)      EXHIBITS.

                        The exhibits to this Report are listed in the Exhibit
            Index on pages 23 and 24 below. Copies of these exhibits are
            available upon written request to RDO Equipment Co., Stockholder
            Relations, 3030 Harbor Lane, Suite 202, Plymouth, Minnesota 55447.

            (b)         REPORTS ON FORM 8-K.

                        The Company filed a Current Report on Form 8-K dated
            October 27, 1998 - Item 7(c). Attached to that Current Report was a
            copy of a news release issued by the Company on October 27, 1998.


                                       20
<PAGE>


                                   SIGNATURES

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

Date: April 23, 1999
                                 RDO EQUIPMENT CO.

                                 By: /s/ Ronald D. Offutt
                                     -----------------------------------------
                                     Ronald D. Offutt
                                     Chairman and Chief Executive Officer

            Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below on April 23, 1999 by the following persons on
behalf of the registrant and in the capacities indicated.

Signature                        Title
---------                        -----

/s/ Ronald D. Offutt             Chairman of the Board, Chief Executive Officer
-----------------------------    and Director (principal executive officer)
Ronald D. Offutt                 


/s/ Thomas K. Espel              Chief Financial Officer
-----------------------------    (principal financial officer)
Thomas K. Espel                  

/s/ Mark A. Doda                 Senior Vice President and Controller
-----------------------------    (principal accounting officer)
Mark A. Doda                     

/s/ Paul T. Horn                 President, Chief Operating Officer and Director
-----------------------------
Paul T. Horn

/s/ Allan F. Knoll               Secretary and Director
-----------------------------                           
Allan F. Knoll                                          
                                                        
/s/ Bradford M. Freeman          Director
-----------------------------                           
Bradford M. Freeman                                     
                                                        
/s/ Ray A. Goldberg              Director
-----------------------------                           
Ray A. Goldberg                                         
                                                        
/s/ Norman M. Jones              Director
-----------------------------                           
Norman M. Jones                                         
                                                        
/s/ James D. Watkins             Director
-----------------------------
James D. Watkins


                                       21
<PAGE>


                                   SCHEDULE II


                        VALUATION AND QUALIFYING ACCOUNTS
                       FOR THE YEAR ENDED JANUARY 31, 1999

<TABLE>
<CAPTION>
                                   Balance at         Additions                          Balance at
                                    Beginning     Charged to Costs                         End of
                                    of Period       and Expenses       Deductions(1)       Period
                                  ------------   ------------------   ---------------   ------------
<S>                                    <C>          <C>                 <C>               <C>     
Accrued Liabilities:
   Restructuring Reserve.......        $ -          $ 2,200,000         $1,915,000        $285,000
</TABLE>


(1) Utilization of previously recorded balances.



              REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE


To RDO Equipment Co:


We have audited in accordance with generally accepted auditing standards, the
financial statements included in RDO Equipment Co and Subsidiaries' Annual
Report on Form 10-K, and have issued our report thereon dated March 17, 1999.
Our audit was made for the purpose of forming an opinion on those statements
taken as a whole. The schedule listed in Item 14(a)(2) is the responsibility of
the Company's management and is presented for purposes of complying with the
Securities and Exchange Commission's rules and is not part of the basic
financial statements. This schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, fairly states in all material respects the financial data required to
be set forth therein in relation to the basic financial statements taken as a
whole.

                                                    ARTHUR ANDERSEN LLP

Minneapolis, Minnesota,
March 17, 1999


                                       22
<PAGE>


                          EXHIBIT INDEX FOR FISCAL YEAR
                             ENDED JANUARY 31, 1999

<TABLE>
<CAPTION>

ITEM NO.   ITEM                                                 METHOD OF FILING
--------   ----                                                 ----------------
<S>        <C>                                                  <C>                 
3.1        Certificate of Incorporation.......................  Incorporated by reference to Exhibit 3.1 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267). 

3.2        Bylaws.............................................  Incorporated by reference to Exhibit 3.2 to the Company's 
                                                                Registration Statement on Form S-1 (File No. 333-13267).  

4.1        Specimen Form of the Company's Class A               
           Common Stock Certificate...........................  Incorporated by reference to Exhibit 4.2 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267). 

4.2        Specimen Form of the Company's Class B               
           Common Stock Certificate...........................  Incorporated by reference to Exhibit 4.3 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267)  

10.1       Agreement between Ronald D. Offutt, RDO
           Equipment Co., John Deere Company and
           John Deere Construction Equipment Company..........  Incorporated by reference to Exhibit 10.1 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267).  

10.2       Form of Deere Agricultural Dealer
           Agreement Package..................................  Incorporated by reference to Exhibit 10.2 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267)   

10.3       Form of Deere Construction Dealer
           Agreement Package..................................  Incorporated by reference to Exhibit 10.3 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267).  

10.4       Deere Agricultural Dealer Finance
           Agreement..........................................  Incorporated by reference to Exhibit 10.6 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267).  

10.5       Deere Construction Dealer Finance
           Agreement..........................................  Incorporated by reference to Exhibit 10.7 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267).  
</TABLE>


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<PAGE>


<TABLE>
<S>        <C>                                                  <C>                 
10.6       Agreement between RDO Equipment Co.,
           John Deere Company and John Deere
           Construction Equipment Company.....................  Incorporated by reference to Exhibit 10.15 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267).   

10.7       Corporate Service Agreement between RDO
           Equipment Co. and R.D. Offutt Company,
           dated as of November 1, 1996.......................  Incorporated by reference to Exhibit 10.10 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267).   

10.8       Tax Agreement Relating to S Corporation
           Distribution, with Supplement......................  Incorporated by reference to Exhibit 10.14 to the Company's
                                                                Registration Statement on Form S-1 (File No. 333-13267).   

10.9       RDO Equipment Co. 1996 Stock Incentive
           Plan, including forms of option agreements*........  Incorporated by reference to Exhibit 10.8 to the Company's Annual
                                                                Report on Form 10-K for the fiscal year ended January 31, 1997.  

10.10      Form of Agreement re: Confidentiality,
           Assignment of Inventions and Non-
           Competition entered into by the Company with
           each of its executive officers and directors*......  Incorporated by reference to Exhibit 10.15 to the Company's Annual
                                                                Report on Form 10-K for the fiscal year ended January 31, 1997.   

10.11      Form of Indemnification Agreement entered
           into by the Company with each of its
           executive officers and directors*..................  Incorporated by reference to Exhibit 10.9 to the Company's 
                                                                Registration Statement on Form S-1 (File No. 333-13267).   

13.1       Excerpts from 1999 Annual Report...................  Filed herewith.

21.1       Subsidiaries.......................................  Filed herewith.

23.1       Consent of Independent Public Accountants..........  Filed herewith.

27.1       Financial Data Schedule............................  Filed herewith.
</TABLE>


--------------------------
*   Management contract or compensatory plan or arrangement filed as an exhibit
    pursuant to Item 14(c) of Form 10-K.


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