----

----

| FOR      THE FISCAL YEAR ENDED | COMMISSION      FILE NUMBER |
|--------------------------------|-----------------------------|
| December      31, 2008         | 1-1553                      |

|   | Maryland                                                        | 52-0248090                                   |   |
|--------|-----------------------------------------------------------------|----------------------------------------------|--------|
|   | (State      of Incorporation)                                   | (I.R.S.      Employer Identification Number) |   |
|   |                                                            |                                         |   |
|   | Towson,      Maryland                                           | 21286                                        |   |
|   | (Address      of principal executive offices)                   | (Zip      Code)                              |   |
|   |                                                            |                                         |   |
|   | (410)      716-3900                                             |                                         |
|   | (Registrant’s      telephone number, including area code) |                                         |

| Title      of each class                    | Name      of each exchange on which registered |
|---------------------------------------------|------------------------------------------------|
| Common      Stock, par value $.50 per share | New      York Stock Exchange                   |

| Securities      registered pursuant to Section 12(g) of the Act: | None |
|------------------------------------------------------------------|------|

| Large      accelerated filer x | Accelerated      filer o | Non-accelerated      filer o |
|--------------------------------|--------------------------|------------------------------|

----

| (a) | General      Development of Business |
|-----|--------------------------------------|

| (b)  | Financial      Information About Business Segments |
|-----------|----------------------------------------------------|

| (c)  | Narrative      Description of the Business |
|-----------|--------------------------------------------|

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| (d)  | Financial      Information About Geographic Areas |
|-----------|---------------------------------------------------|

| (e)  | Available      Information |
|-----------|----------------------------|

----

| (f)  | Executive      Officers and Other Senior Officers of the  Corporation |
|-----------|-----------------------------------------------------------------------|

| •  | NOLAN D. ARCHIBALD –      65 |
|---------------|------------------------------------|

|   | Chairman,      President, and |
|--------|-------------------------------|

|   | Chief      Executive Officer, |
|--------|-------------------------------|

|   | January      1990 – present. |
|--------|------------------------------------|

| •  | BRUCE W. BROOKS –      44 |
|---------------|---------------------------------|

|   | Group      Vice President of the Corporationand |
|--------|-------------------------------------------------|

|   | President      – Consumer Products Group, |
|--------|-------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | January      2009 – present; |
|--------|------------------------------------|

|   | Group      Vice President of the Corporationand |
|--------|-------------------------------------------------|

|   | President      – Consumer Products Group |
|--------|------------------------------------------------|

|   | for      North America, |
|--------|-------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | September      2008 – January 2009; |
|--------|-------------------------------------------|

|   | Group      Vice President of the Corporationand |
|--------|-------------------------------------------------|

|   | President      – Consumer Products Group, |
|--------|-------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | March      2007 – September 2008; |
|--------|-----------------------------------------|

|   | Vice      President of the Corporation and President– |
|--------|-------------------------------------------------------------|

|   | Construction      Tools, Industrial ProductsGroup, |
|--------|----------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | May      2005 – March 2007; |
|--------|-----------------------------------|

|   | Vice      President and General Manager– |
|--------|------------------------------------------------|

|   | Construction      Tools, Industrial ProductsGroup, |
|--------|----------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | October      2004 – May 2005; |
|--------|-------------------------------------|

|   | Vice      President Marketing – DeWALT      Professional |
|--------|----------------------------------------------------------------|

|   | Products,      Power Tools and AccessoriesGroup, |
|--------|--------------------------------------------------|

|   | July      2003 – October 2004. |
|--------|--------------------------------------|

| •  | JAMES T. CAUDILL –      41 |
|---------------|----------------------------------|

|   | Group      Vice President of the Corporationand |
|--------|-------------------------------------------------|

|    | President      – Hardware and HomeImprovement, |
|--------------|------------------------------------------------------|

|   | July      2006 – present; |
|--------|---------------------------------|

|   | Vice      President of the Corporation and President– |
|--------|-------------------------------------------------------------|

|   | Hardware      and Home Improvement, |
|--------|-------------------------------------|

|   | May      2005 – July 2006; |
|--------|----------------------------------|

|   | Vice      President and General Manager– |
|--------|------------------------------------------------|

|   | Accessories,      Industrial Products Group, |
|--------|----------------------------------------------|

|   | Power      Tools and Accessories Group, |
|--------|-----------------------------------------|

|   | October      2004 – May 2005; |
|--------|-------------------------------------|

|   | Vice      President – Accessories, |
|--------|------------------------------------------|

|   | DeWALT      Professional Products, |
|--------|------------------------------------|

|   | Power      Tools and Accessories Group, |
|--------|-----------------------------------------|

|   | November      2001 – October 2004. |
|--------|------------------------------------------|

| •  | CHARLES E. FENTON –      60 |
|---------------|-----------------------------------|

|   | Senior      Vice President and GeneralCounsel, |
|--------|------------------------------------------------|

|   | December      1996 – present. |
|--------|-------------------------------------|

| •  | LES H. IRELAND –  44 |
|---------------|----------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | President      – North America, |
|--------|---------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | January      2009 – present; |
|--------|------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | President      – Commercial Operations – |
|--------|------------------------------------------------------|

|   | Industrial      Products Group, |
|--------|---------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | April      2008 – January 2009; |
|--------|---------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | President      – Europe/Middle East/Africa, |
|--------|---------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | January      2005 – April 2008; |
|--------|---------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Managing      Director – CommercialOperations, |
|--------|------------------------------------------------------|

|   | Europe,      Black & Decker ConsumerGroup, |
|--------|------------------------------------------------|

|   | Power      Tools and Accessories Group, |
|--------|-----------------------------------------|

|   | November      2001 – January 2005. |
|--------|------------------------------------------|

| •  | MICHAEL D. MANGAN –      52 |
|---------------|-----------------------------------|

|   | Senior      Vice President of theCorporation |
|--------|----------------------------------------------|

|   | and      President – Worldwide PowerTools |
|--------|-------------------------------------------------|

|   | and      Accessories, |
|--------|-----------------------|

|   | September      2008 – present; |
|--------|--------------------------------------|

|   | Senior      Vice President and Chief FinancialOfficer, |
|--------|--------------------------------------------------------|

|   | January      2000 – September 2008. |
|--------|-------------------------------------------|

----

| •  | PAUL F. McBRIDE –    53 |
|---------------|-------------------------------|

|   | Senior      Vice President – HumanResources |
|--------|---------------------------------------------------|

|   | and      Corporate Initiatives, |
|--------|---------------------------------|

|   | March      2004 – present; |
|--------|----------------------------------|

|   | Executive      Vice President of theCorporation |
|--------|-------------------------------------------------|

|   | and      President – Power Tools and |
|--------|--------------------------------------------|

|   | Accessories      Group, |
|--------|-------------------------|

|   | April      1999 – March 2004. |
|--------|-------------------------------------|

| •  | CHRISTINA M. McMULLEN –    53 |
|---------------|-------------------------------------|

|   | Vice      President and Controller, |
|--------|-------------------------------------|

|   | April      2000 – present. |
|--------|----------------------------------|

| •  | ANTHONY V. MILANDO –      46 |
|---------------|------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – Worldwide PowerTools |
|--------|--------------------------------------------------|

|   | and      Accessories Operations, |
|--------|----------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | January      2009 – present; |
|--------|------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – Industrial ProductsGroup |
|--------|------------------------------------------------------|

|   | Global      Operations, |
|--------|-------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | July      2008 – January 2009; |
|--------|--------------------------------------|

|   | Vice      President – Industrial ProductsGroup |
|--------|------------------------------------------------------|

|   | Global      Operations, |
|--------|-------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | November      2005 – July 2008; |
|--------|---------------------------------------|

|   | Vice      President – Global Sourcing, |
|--------|----------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | March      2001 – November 2005. |
|--------|----------------------------------------|

| •  | AMY K. O’KEEFE –    38 |
|---------------|------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – Worldwide PowerTools |
|--------|--------------------------------------------------|

|   | and      Accessories Finance, |
|--------|-------------------------------|

|   | September      2008 – present; |
|--------|--------------------------------------|

|   | Vice      President of Finance, |
|--------|---------------------------------|

|   | Hardware      and Home Improvement Group, |
|--------|-------------------------------------------|

|   | August      2004 – September 2008; |
|--------|------------------------------------------|

|   | Vice      President of Finance, |
|--------|---------------------------------|

|   | Consumer      Power Tools and AccessoriesGroup, |
|--------|-------------------------------------------------|

|   | November      2000 – August 2004. |
|--------|-----------------------------------------|

| •  | JAIME A. RAMIREZ –      41 |
|---------------|----------------------------------|

|   | Vice      President of the Corporation and President– |
|--------|-------------------------------------------------------------|

|   | Latin      America, Power Tools andAccessories, |
|--------|-------------------------------------------------|

|   | September      2008 – present; |
|--------|--------------------------------------|

|   | Vice      President and General Manager– |
|--------|------------------------------------------------|

|   | Latin      America, Power Tools andAccessories, |
|--------|-------------------------------------------------|

|   | May      2007 – September 2008; |
|--------|---------------------------------------|

|   | Vice      President and General Manager– |
|--------|------------------------------------------------|

|   | Andean      Region, Power Tools andAccessories, |
|--------|-------------------------------------------------|

|   | July      2000 – May 2007. |
|--------|----------------------------------|

| •  | JAMES R. RASKIN –      48 |
|---------------|---------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – BusinessDevelopment, |
|--------|--------------------------------------------------|

|   | July      2006 – present; |
|--------|---------------------------------|

|   | Vice      President – BusinessDevelopment, |
|--------|--------------------------------------------------|

|   | May      2002 – July 2006. |
|--------|----------------------------------|

| •  | STEPHEN F. REEVES –      49 |
|---------------|-----------------------------------|

|   | Senior      Vice President and Chief FinancialOfficer, |
|--------|--------------------------------------------------------|

|   | September      2008 – present; |
|--------|--------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – Global Finance, |
|--------|---------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | March      2004 – September 2008; |
|--------|-----------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – Finance, Power Tools |
|--------|--------------------------------------------------|

|   | and      Accessories Group, |
|--------|-----------------------------|

|   | April      2000 – March 2004. |
|--------|-------------------------------------|

| •  | MARK M. ROTHLEITNER –      50 |
|---------------|-------------------------------------|

|   | Vice      President – Investor Relations andTreasurer, |
|--------|--------------------------------------------------------------|

|   | January      2000 – present. |
|--------|------------------------------------|

| •  | JOHN W. SCHIECH –      50 |
|---------------|---------------------------------|

|   | Group      Vice President of the Corporationand |
|--------|-------------------------------------------------|

|   | President      – Industrial Products Group, |
|--------|---------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | January      2009 – present; |
|--------|------------------------------------|

|   | Group      Vice President of theCorporation |
|--------|---------------------------------------------|

|   | and      President – Industrial ProductsGroup |
|--------|-----------------------------------------------------|

|   | for      North America, Power Tools andAccessories, |
|--------|-----------------------------------------------------|

|   | September      2008 – January 2009; |
|--------|-------------------------------------------|

|   | Group      Vice President of theCorporation |
|--------|---------------------------------------------|

|   | and      President – Industrial ProductsGroup, |
|--------|------------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | March      2004 – September 2008; |
|--------|-----------------------------------------|

|   | Vice      President of the Corporation and President– |
|--------|-------------------------------------------------------------|

|   | DeWALT      Professional Products, Power Tools |
|--------|------------------------------------------------|

|   | and      Accessories Group, |
|--------|-----------------------------|

|   | January      2001 – March 2004. |
|--------|---------------------------------------|

| •  | NATALIE A. SHIELDS –      52 |
|---------------|------------------------------------|

|   | Vice      President and CorporateSecretary, |
|--------|---------------------------------------------|

|   | April      2006 – present; |
|--------|----------------------------------|

|   | International      Tax and Trade Counsel, |
|--------|-------------------------------------------|

|   | June      1993 – April 2006. |
|--------|------------------------------------|

| •  | BEN S. SIHOTA –      50 |
|---------------|-------------------------------|

|   | Vice      President of the Corporation and President– |
|--------|-------------------------------------------------------------|

|   | Asia      Pacific, Power Tools andAccessories, |
|--------|------------------------------------------------|

|   | February      2006 – present; |
|--------|-------------------------------------|

|   | President      – Asia, Power Tools andAccessories, |
|--------|----------------------------------------------------------|

|   | September      2000 – February 2006. |
|--------|--------------------------------------------|

----

| •  | WILLIAM S. TAYLOR –  53 |
|---------------|-------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – Global ProductDevelopment |
|--------|-------------------------------------------------------|

|   | Industrial      Products Group,   |
|--------|-----------------------------------|
|   | Power      Tools and Accessories, |

|   | January      2009 – present; |
|--------|------------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | Vice      President – IndustrialProducts |
|--------|------------------------------------------------|

|   | Group      Product Development, |
|--------|---------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | July      2008 – January 2009; |
|--------|--------------------------------------|

|   | Vice      President – Industrial ProductsGroup |
|--------|------------------------------------------------------|

|   | Product      Development, |
|--------|---------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | April      2008 – July 2008; |
|--------|------------------------------------|

|   | Vice      President/General Manager – |
|--------|---------------------------------------------|

|   | Industrial      Accessories Business, |
|--------|---------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | June      2005 – April 2008; |
|--------|------------------------------------|

|   | Vice      President and General Manager– |
|--------|------------------------------------------------|

|   | Woodworking      Tools, Power Tools andAccessories, |
|--------|-----------------------------------------------------|

|   | October      2004 – June 2005; |
|--------|--------------------------------------|

|   | Vice      President, Product ServiceDivision, |
|--------|-----------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | January      2003 – October 2004. |
|--------|-----------------------------------------|

| •  | MICHAEL A. TYLL –      52 |
|---------------|---------------------------------|

|   | Group      Vice President of the Corporationand |
|--------|-------------------------------------------------|

|   | President      – Fastening and AssemblySystems, |
|--------|-------------------------------------------------------|

|   | April      2006 – present; |
|--------|----------------------------------|

|   | President      – Automotive Division, |
|--------|---------------------------------------------|

|   | Fastening      and Assembly Systems, |
|--------|--------------------------------------|

|   | January      2001 – April 2006. |
|--------|---------------------------------------|

| •  | JOHN H. A. WYATT –      50 |
|---------------|----------------------------------|

|   | Vice      President of the Corporationand |
|--------|-------------------------------------------|

|   | President      – Europe, Middle East, andAfrica |
|--------|-------------------------------------------------------|

|   | Power      Tools and Accessories, |
|--------|-----------------------------------|

|   | September      2008 – present; |
|--------|--------------------------------------|

|   | Vice      President – Consumer Products |
|--------|-----------------------------------------------|

|   | (Europe,      Middle East and Africa), |
|--------|----------------------------------------|

|   | October      2006 – September 2008. |
|--------|-------------------------------------------|

| (g)  | Forward-Looking      Statements |
|-----------|---------------------------------|

----

----

----

----

----

----

----

| (a)  | Market      Information |
|-----------|-------------------------|

| QUARTER                  |   | 2008 |   |   | 2007 |   |
|--------------------------|--------|------|--------|--------|------|--------|
| January      to March    |   | $    | 74.240 |   | to   |   | $ | 61.710 |   |   | $ | 90.910 |   | to |   | $ | 78.810 |   |
| April      to June       |   | $    | 71.230 |   | to   |   | $ | 57.500 |   |   | $ | 96.070 |   | to |   | $ | 81.400 |   |
| July      to September   |   | $    | 69.500 |   | to   |   | $ | 51.560 |   |   | $ | 97.010 |   | to |   | $ | 79.300 |   |
| October      to December |   | $    | 62.090 |   | to   |   | $ | 32.310 |   |   | $ | 92.300 |   | to |   | $ | 69.150 |   |

| (b) | Holders      of the Corporation’s Capital Stock |
|-----|-------------------------------------------------------|

| (c) | Dividends |
|-----|-----------|

| QUARTER                  |   | 2008   |   |   | 2007   |   |
|--------------------------|--------|--------|--------|--------|--------|--------|
| January      to March    |   | $      | .42    |   |   | $      | .42 |   |
| April      to June       |   |   | .42    |   |   |   | .42 |   |
| July      to September   |   |   | .42    |   |   |   | .42 |   |
| October      to December |   |   | .42    |   |   |   | .42 |   |
|                     |   | $      | 1.68   |   |   | $      | 1.68 |   |

| (d) | Annual      Meeting of Stockholders |
|-----|-------------------------------------|

----

| (e) | Performance      Graph |
|-----|------------------------|

| (1)  | Assumes      $100 invested at the close of business on December 31, 2003 in Black &      Decker common stock, Standard & Poor’s (S&P) 500 Index, and      the Peer Group. |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)  | The      cumulative total return assumes reinvestment      of dividends. |
|-----------|--------------------------------------------------------------------------|

| (3)  | The      Peer Group consists of the companies in      the following indices within the Standard & Poor’s Super Composite      1,500: Household Appliances, Housewares & Specialties, Industrial      Machinery, and Building Products. A list of the companies in the      Peer Group will be furnished upon request addressed to the Corporate      Secretary at 701 East Joppa Road, Towson,    Maryland 21286. |
|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4)  | Total      return is weighted according to market capitalization of each company at      the beginning of each year. |
|-----------|----------------------------------------------------------------------------------------------------------------------|

|  (f) | Issuer      Purchases of Equity Securities |
|-----------|--------------------------------------------|

| PERIOD      (a)                                       | TOTAL      NUMBEROF      SHARESPURCHASED |   | AVERAGEPRICE      PAIDPER      SHARE | TOTAL      NUMBEROF      SHARES PURCHASED      ASPART      OF PUBLICLYANNOUNCED      PLANS | MAXIMUM      NUMBEROF      SHARESTHAT      MAY YETBE      PURCHASEDUNDER      THE PLANS | (c)  |
|-------------------------------------------------------|------------------------------------------|--------|--------------------------------------|-------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------|-----------|
| September      29, 2008 through October      26, 2008 | 262                                      | (b)    | $                                    | 53.58                                                                                           | —                                                                                 |      | 3,777,145 |   |
| October      27, 2008 through November      30, 2008  | —                                  |   |                                 | —                                                                                         | —                                                                                 |      | 3,777,145 |   |
| December      1, 2008 through December      31, 2008  | —                                  |   |                                 | —                                                                                         | —                                                                                 |      | 3,777,145 |   |
| Total                                                 | 262                                      |   | $                                    | 53.58                                                                                           | —                                                                                 |      | 3,777,145 |   |

| (a)  | The      periods represent the Corporation’s monthly fiscal    calendar. |
|-----------|--------------------------------------------------------------------------------|

| (b)  | Shares      acquired from associates to satisfy withholding tax requirements upon the      vesting of restricted stock. |
|-----------|-------------------------------------------------------------------------------------------------------------------------|

| (c)  | The      maximum number of shares that may yet be purchased under the plans      represent the remaining shares that are available pursuant to the      Corporation’s publicly announced repurchase plans. The maximum number of      shares that may yet be purchased under the plans noted above included      4,000,000 shares authorized by the Board of Directors on October 17, 2007,      and 2,000,000 shares authorized by the Board of Directors on February 14,      2008. There is no expiration date or current intent to terminate the      repurchase plans. |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (DOLLARS      IN MILLIONS EXCEPT PER SHARE DATA)             |   | 2008   |        (b) |   | 2007   |        (c) |    | 2006   |   | 2005   |        (d) |   | 2004   |    |
|--------------------------------------------------------------|--------|--------|-----------------|--------|--------|-----------------|---------|--------|--------|--------|-----------------|--------|--------|---------|
| Sales                                                        |   | $      | 6,086.1         |   |   | $               | 6,563.2 |   |   | $      | 6,447.3         |   | $      | 6,523.7 |   |   | $ | 5,398.4 |   |
| Net      earnings from continuing operations                 |   |   | 293.6           |   |   |            | 518.1   |   |   |   | 486.1           |   |   | 532.2   |   |   |   | 430.7 |   |
| (Loss)      earnings from discontinued operations (e)        |   |   | —         |   |   |            | — |   |   |   | —         |   |   | (.1     | ) |   |   | 14.9 |   |
| Net      earnings                                            |   |   | 293.6           |   |   |            | 518.1   |   |   |   | 486.1           |   |   | 532.1   |   |   |   | 445.6 |   |
| Basic      earnings per share:                               |   |   |            |   |   |            |    |   |   |   |            |   |   |    |   |   |   |   |   |
| Continuing      operations                                   |   |   | 4.91            |   |   |            | 8.06    |   |   |   | 6.74            |   |   | 6.72    |   |   |   | 5.40 |   |
| Discontinued      operations                                 |   |   | —         |   |   |            | — |   |   |   | —         |   |   | — |   |   |   | .19 |   |
| Net      earnings per common share – basic             |   |   | 4.91            |   |   |            | 8.06    |   |   |   | 6.74            |   |   | 6.72    |   |   |   | 5.59 |   |
| Diluted      earnings per share:                             |   |   |            |   |   |            |    |   |   |   |            |   |   |    |   |   |   |   |   |
| Continuing      operations                                   |   |   | 4.82            |   |   |            | 7.85    |   |   |   | 6.55            |   |   | 6.54    |   |   |   | 5.31 |   |
| Discontinued      operations                                 |   |   | —         |   |   |            | — |   |   |   | —         |   |   | — |   |   |   | .18 |   |
| Net      earnings per common share – assuming dilution |   |   | 4.82            |   |   |            | 7.85    |   |   |   | 6.55            |   |   | 6.54    |   |   |   | 5.49 |   |
| Total      assets                                            |   |   | 5,183.3         |   |   |            | 5,410.9 |   |   |   | 5,247.7         |   |   | 5,842.4 |   |   |   | 5,555.0 |   |
| Long-term      debt                                          |   |   | 1,444.7         |   |   |            | 1,179.1 |   |   |   | 1,170.3         |   |   | 1,030.3 |   |   |   | 1,200.6 |   |
| Redeemable      preferred stock of subsidiary                |   |   | —         |   |   |            | — |   |   |   | —         |   |   | — |   |   |   | 192.2 |   |
| Cash      dividends per common share                         |   |   | 1.68            |   |   |            | 1.68    |   |   |   | 1.52            |   |   | 1.12    |   |   |   | .84 |   |

| (a)  | The      Corporation adopted Statement of Financial Accounting Standard (SFAS) No.      123R, Share-Based      Payment, effective January 1, 2006, using the modified      retrospective method of adoption whereby the Corporation restated all      prior periods presented based on amounts previously recognized under SFAS      No. 123 for purposes of pro forma disclosures. Amounts in this five-year      summary for 2005 and 2004 reflect such restated  amounts. |
|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)  | Earnings      from continuing operations for 2008 includes a restructuring charge of      $54.7 million before taxes ($39.6 million after  taxes). |
|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| (c)  | Earnings      from continuing operations for 2007 includes a favorable $153.4 million      settlement of tax litigation. In addition, earnings from continuing      operations for 2007 include a charge for an environmental remediation      matter of $31.7 million before taxes ($20.6 million after taxes) and a      restructuring charge of $19.0 million before taxes ($12.8 million after      taxes). |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d)  | Earnings      from continuing operations for 2005 include a favorable $55.0 million      before taxes ($35.8 million after taxes) settlement of environmental and      product liability coverage litigation with an insurer. In addition,      earnings from continuing operations for 2005 includes $51.2 million of      incremental tax expense resulting from the repatriation of $888.3 million      of foreign earnings under the American Jobs Creation Act of      2004. |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e)  | (Loss)      earnings from discontinued operations represent the earnings, net of      applicable income taxes, of the Corporation’s discontinued European      security hardware business. Loss from discontinued operations for the year      ended December 31, 2005, includes a loss on sale of discontinued      operations of $.1 million. Earnings from discontinued operations for the      year ended December 31, 2004, include a gain on sale of discontinued of      operations of $12.7 million. That gain was net of a $24.4 million goodwill      impairment charge associated with the DOM security hardware business. The      earnings of the discontinued operations do not reflect any expense for      interest allocated by or management fees charged by the      Corporation. |
|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| (DOLLARS      IN MILLIONS)            |   | 2008   |    |          | 2007   |   |    | 2006          |   |
|---------------------------------------|--------|--------|---------|---------------|--------|--------|---------|---------------|--------|
| Total      sales                      |   | $      | 6,086.1 |          |   | $      | 6,563.2 |          |   | $ | 6,447.3 |   |
| Unit      volume – existing (a) |   |   | (9      | ) %      |   |   | (1      | )      %      |   |   | (2 | )      % |
| Unit      volume – acquired (b) |   |   | — |        % |   |   | — |        % |   |   | 2 |        % |
| Price                                 |   |   | — |        % |   |   | — |        % |   |   | (1 | )      % |
| Currency                              |   |   | 2       |        % |   |   | 3       |        % |   |   | — |        % |
| Change      in total sales            |   |   | (7      | )      %      |   |   | 2       |        % |   |   | (1 | )      % |

| (a)  | Represents      change in unit volume for businesses where year-to-year comparability      exists. |
|-----------|----------------------------------------------------------------------------------------------------|

| (b)  | Represents      change in unit volume for businesses that were acquired and were not      included in prior periodresults. |
|-----------|----------------------------------------------------------------------------------------------------------------------------|

----

|                                               |   | YEAR      ENDED DECEMBER 31, |   |
|----------------------------------------------------|--------|------------------------------|--------|
| (PERCENTAGE      OF SALES)                         |   | 2008                         |   |   | 2007 |   |   | 2006 |   |
| Gross      margin                                  |   |                         | 32.8   | % |   |   | 33.9 | % |   |   | 34.8 | % |
| Selling,      general, and administrative expenses |   |                         | 25.0   | % |   |   | 24.7 | % |   |   | 23.3 | % |
| Restructuring      and exit costs                  |   |                         | .9     | % |   |   | .3 | % |   |   | — | % |
| Operating      income                              |   |                         | 6.9    | % |   |   | 8.9 | % |   |   | 11.5 | % |

----

| YEAR      ENDED DECEMBER 31,         |   | 2008   |    |   | 2007   |   |    | 2006   |   |
|--------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| Sales      to unaffiliated customers |   | $      | 4,371.6 |   |   | $      | 4,843.7 |   |   | $ | 4,907.3 |   |
| Segment      profit                  |   |   | 321.3   |   |   |   | 488.8   |   |   |   | 591.3 |   |

----

| YEAR      ENDED DECEMBER 31,         |   | 2008   |   |   | 2007   |   |    | 2006   |   |
|--------------------------------------|--------|--------|--------|--------|--------|--------|---------|--------|--------|
| Sales      to unaffiliated customers |   | $      | 896.6  |   |   | $      | 1,006.7 |   |   | $ | 1,014.5 |   |
| Segment      profit                  |   |   | 76.9   |   |   |   | 114.9   |   |   |   | 138.3 |   |

----

| YEAR      ENDED DECEMBER 31,         |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|--------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Sales      to unaffiliated customers |   | $      | 700.4  |   |   | $      | 718.3  |   |   | $ | 692.4 |   |
| Segment      profit                  |   |   | 103.3  |   |   |   | 111.5  |   |   |   | 100.4 |   |

----

----

----

----

| (U.S.      DOLLARS IN MILLIONS)                                 | 2009   |    | 2010   |   | 2011    |   | 2012   |    | 2013   |   | THERE-AFTER |   | TOTAL  |    | FAIR      VALUE (ASSETS)/ LIABILITIES |
|-----------------------------------------------------------------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|-------------|--------|--------|---------|---------------------------------------|
| LIABILITIES                                                     |   |    |   |   |    |   |   |    |   |   |        |   |   |    |                                  |
| Short-term      borrowings                                      |   |    |   |   |    |   |   |    |   |   |        |   |   |    |                                  |
| Variable      rate (U.S. dollars and other      currencies) (a) | $      | 83.3    |   | $      | — |   | $      | — |   | $      | —     |   | $      | — |                                  | $ | — |   | $ | 83.3 |   | $ | 83.3 |
| Average      interest rate                                      |   | 2.20    | %      |   |    |   |   |    |   |   |        |   |   |    |                                  |   |   |   |   | 2.20 | % |   |   |
| Long-term      debt                                             |   |    |   |   |    |   |   |    |   |   |        |   |   |    |                                  |   |   |   |   |   |   |   |   |
| Variable      rate (U.S. dollars)                               | $      | — |   | $      | — |   | $      | 125.0   |   | $      | 100.0       |   | $      | — |                                  | $ | — |   | $ | 225.0 |   | $ | 225.2 |
| Average      interest rate                                      |   |    |   |   |    |   |   | 4.13    | %      |   | 3.30        | %      |   |    |                                  |   |   |   |   | 3.76 | % |   |   |
| Fixed      rate (U.S. dollars)                                  | $      | .1      |   | $      | — |   | $      | 400.0   |   | $      | —     |   | $      | — |                                  | $ | 750.0 |   | $ | 1,150.1 |   | $ | 1,062.3 |
| Average      interest rate                                      |   | 7.00    | %      |   |    |   |   | 7.13    | %      |   |        |   |   |    |                                  |   | 5.61 | % |   | 6.14 | % |   |   |
| INTEREST      RATE DERIVATIVES                                  |   |    |   |   |    |   |   |    |   |   |        |   |   |    |                                  |   |   |   |
| Fixed      to Variable Rate Interest                            |   |    |   |   |    |   |   |    |   |   |        |   |   |    |                                  |   |   |   |   |   |   |   |   |
| Rate      Swaps (U.S. dollars)                                  | $      | — |   | $      | — |   | $      | 100.0   |   | $      | —     |   | $      | — |                                  | $ | 225.0 |   | $ | 325.0 |   | $ | (44.9) |
| Average      pay rate (b)                                       |   |    |   |   |    |   |   |    |   |   |        |   |   |    |                                  |   |   |   |   |   |   |   |   |
| Average      receive rate                                       |   |    |   |   |    |   |   | 4.87    | %      |   |        |   |   |    |                                  |   | 4.79 | % |   | 4.81 | % |   |   |

| (a)  | Short-term      borrowings of $83.3 million include $81.5 million and $1.8 million that      are denominated in U.S. dollars and other currencies,      respectively. |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)  | The      average pay rate for swaps in the notional principal amount of $125.0      million is based upon 3-month forward LIBOR (with swaps in the notional      principal amounts of $100.0 million maturing in 2011 and $25.0 million      maturing thereafter). The average pay rate for the remaining swap is based      upon 6-month forward LIBOR. |
|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                                  |   | 2008    |   |   | 2007   |    |   | 2006   |   |
|-------------------------------------------------------|--------|---------|--------|--------|--------|---------|--------|--------|--------|
| Cash      flow provided by operating activities       |   | $       | 425.4  |   |   | $       | 725.9  |   |   | $ | 622.7 |   |
| Cash      flow used in investing activities           |   |    | (61.4  | )      |   |    | (149.8 | )      |   |   | (241.0 | ) |
| Cash      flow used in financing activities      |   |    | (317.0 | )      |   |    | (568.2 | )      |   |   | (1,124.9 | ) |
| Effect      of exchange rate changes on cash          |   |    | (23.9  | )      |   |    | 13.5   |   |   |   | 8.9 |   |
| Increase      (decrease) in cash and cash equivalents |   | $  | 23.1   |   |   | $  | 21.4   |   |   | $  | (734.3 | ) |
| Cash      and cash equivalents at end of year         |   | $       | 277.8  |   |   | $       | 254.7  |   |   | $ | 233.3 |   |

----

----

|                                 | LONG-TERM DEBT | SHORT-TERM DEBT | OUTLOOK |
|--------------------------------------|---------------------|----------------------|---------|
| Moody’s      Investors Service | Baa2                | P2                   | Stable  |
| Standard      & Poor’s     | BBB                 | A2                   | Stable  |
| Fitch      Ratings                   | BBB                 | F2                   | Stable  |

----

|                                            | PAYMENTS      DUE BY PERIOD |
|-------------------------------------------------|-----------------------------|
|                                            | LESS      THAN 1      YEAR  |   | 1 TO      3 YEARS |   | 3 TO      5 YEARS |   | AFTER      5 YEARS |   | TOTAL |
| Short-term      borrowings (a) (b) (c)          | $                           | 83.3 |   | $ | — |   | $ | — |   | $ | — |   | $ | 83.3 |
| Long-term      debt (c)                         |                        | 79.2 |   |   | 665.3 |   |   | 187.3 |   |   | 974.6 |   |   | 1,906.4 |
| Operating      leases                           |                        | 69.8 |   |   | 80.5 |   |   | 25.2 |   |   | 16.8 |   |   | 192.3 |
| Purchase      obligations (d)                   |                        | 418.6 |   |   | 5.5 |   |   | 1.5 |   |   | .6 |   |   | 426.2 |
| Total      contractual cash obligations (e) (f) | $                           | 650.9 |   | $ | 751.3 |   | $ | 214.0 |   | $ | 992.0 |   | $ | 2,608.2 |

| (a)  | As      more fully described in Note 7 of Notes to Consolidated Financial      Statements, the Corporation has a $1.0 billion commercial paper program as      well as a supporting $1.0 billion credit facility that matures in December      2012. At December 31, 2008, there was $65.0 million outstanding under the      commercial paper program and $18.3 million outstanding under other      short-term borrowing arrangements. The Corporation’s average borrowing      outstanding under these facilities during 2008 was $651.7      million. |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)  | As      described in Note 7 of Notes to Consolidated Financial Statements, the      Corporation has uncommitted lines of credit of approximately $375 million      at December 31, 2008. These uncommitted lines of credit do not have      termination dates and are reviewedperiodically. |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c)  | Payments      due by period include contractually required interest payments.       Contractually required interest payments on variable rate long-term debt      presented is based upon variable borrowing rates at December 31,      2008. |
|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d)  | The      Corporation enters into contractual arrangements that result in its      obligation to make future payments, including purchase obligations. The      Corporation enters into these arrangements in the ordinary course of      business in order to ensure adequate levels of inventories, machinery and      equipment, or services. Purchase obligations primarily consist of      inventory purchase commitments, including raw materials, components, and      sourced products, sponsorship arrangements, and arrangements for other      services. |
|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e)  | The      Corporation anticipates that funding of its pension and postretirement      benefit plans in 2009 will approximate $50 million to $55 million. That      amount principally represents contributions either required by regulations      or laws or, with respect to unfunded plans, necessary to fund current      benefits. The Corporation has not presented estimated pension and      postretirement funding in the table above as the funding can vary from      year to year based upon changes in the fair value of the plan assets and      actuarial assumptions. |
|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f)  | As      more fully disclosed in Notes 1 and 11 of Notes to the Consolidated      Financial Statements, the Corporation adopted FIN 48, Accounting      for Uncertainty in Income Taxes – an interpretation of FASB Statement No.      109, on January 1, 2007. At December 31, 2008, the Corporation has      recognized $255.8 million of liabilities for unrecognized tax benefits of      which $24.3 million related to interest. The final outcome of these tax      uncertainties is dependent upon various matters including tax      examinations, legal proceedings, competent authority proceedings, changes      in regulatory tax laws, or interpretation of those tax laws, or expiration      of statutes of limitation. However, based on the number of jurisdictions,      the uncertainties associated with litigation, and the status of      examinations, including the protocols of finalizing audits by the relevant      tax authorities, which could include formal legal proceedings, there is a      high degree of uncertainty regarding the future cash outflows associated      with these tax uncertainties. As of December 31, 2008, the Corporation      classified $47.5 million of its liabilities for unrecognized tax benefits      as a current liability. While the Corporation cannot reasonably predict      the timing of the cash flows, if any, associated with its liabilities for      unrecognized tax benefits, it believes that such cash flows would      principally occur within the next fiveyears. |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| YEAR      ENDED DECEMBER 31,                                                                              |   | 2008   |    |   | 2007   |   |    | 2006   |   |
|-----------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| SALES                                                                                                     |   | $      | 6,086.1 |   |   | $      | 6,563.2 |   |   | $ | 6,447.3 |   |
| Cost      of goods sold                                                                                   |   |   | 4,087.7 |   |   |   | 4,336.2 |   |   |   | 4,205.8 |   |
| Selling,      general, and administrative expenses                                                        |   |   | 1,521.6 |   |   |   | 1,625.8 |   |   |   | 1,501.1 |   |
| Restructuring      and exit costs                                                                         |   |   | 54.7    |   |   |   | 19.0    |   |   |   | — |   |
| OPERATING      INCOME                                                                                     |   |   | 422.1   |   |   |   | 582.2   |   |   |   | 740.4 |   |
| Interest      expense (net of interest income of $38.4      for 2008, $19.8 for 2007, and $29.6 for 2006) |   |   | 62.4    |   |   |   | 82.3    |   |   |   | 73.8 |   |
| Other      (income) expense                                                                               |   |   | (5.0    | )      |   |   | 2.3     |   |   |   | 2.2 |   |
| EARNINGS      BEFORE INCOME TAXES                                                                         |   |   | 364.7   |   |   |   | 497.6   |   |   |   | 664.4 |   |
| Income      taxes (benefit)                                                                               |   |   | 71.1    |   |   |   | (20.5   | )      |   |   | 178.3 |   |
| NET      EARNINGS                                                                                         |   | $      | 293.6   |   |   | $      | 518.1   |   |   | $ | 486.1 |   |
| NET      EARNINGS PER COMMON SHARE – BASIC                                                          |   | $      | 4.91    |   |   | $      | 8.06    |   |   | $ | 6.74 |   |
| NET      EARNINGS PER COMMON SHARE – ASSUMING DILUTION                                              |   | $      | 4.82    |   |   | $      | 7.85    |   |   | $ | 6.55 |   |

----

| DECEMBER      31,                                                                                                              |   | 2008   |    |   | 2007   |   |
|--------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|
| ASSETS                                                                                                                         |   |   |    |   |   |   |
| Cash      and cash equivalents                                                                                                 |   | $      | 277.8   |   |   | $      | 254.7 |   |
| Trade      receivables, less allowances of $39.1 for 2008 and $44.2 for      2007                                              |   |   | 924.6   |   |   |   | 1,109.4 |   |
| Inventories                                                                                                                    |   |   | 1,024.2 |   |   |   | 1,145.8 |   |
| Other      current assets                                                                                                      |   |   | 377.0   |   |   |   | 329.6 |   |
| TOTAL      CURRENT ASSETS                                                                                                      |   |   | 2,603.6 |   |   |   | 2,839.5 |   |
| PROPERTY,      PLANT, AND EQUIPMENT                                                                                            |   |   | 527.9   |   |   |   | 596.2 |   |
| GOODWILL                                                                                                                       |   |   | 1,223.2 |   |   |   | 1,212.9 |   |
| OTHER      ASSETS                                                                                                              |   |   | 828.6   |   |   |   | 762.3 |   |
|                                                                                                                           |   | $      | 5,183.3 |   |   | $      | 5,410.9 |   |
| LIABILITIES      AND STOCKHOLDERS’ EQUITY                                                                                |   |   |    |   |   |   |   |   |
| Short-term      borrowings                                                                                                     |   | $      | 83.3    |   |   | $      | 329.7 |   |
| Current      maturities of long-term debt                                                                                      |   |   | .1      |   |   |   | .2 |   |
| Trade      accounts payable                                                                                                    |   |   | 453.1   |   |   |   | 504.6 |   |
| Other      current liabilities                                                                                                 |   |   | 947.4   |   |   |   | 1,046.3 |   |
| TOTAL      CURRENT LIABILITIES                                                                                                 |   |   | 1,483.9 |   |   |   | 1,880.8 |   |
| LONG-TERM      DEBT                                                                                                            |   |   | 1,444.7 |   |   |   | 1,179.1 |   |
| POSTRESTIREMENT      BENEFITS                                                                                                  |   |   | 669.4   |   |   |   | 311.3 |   |
| OTHER      LONG-TERM LIABILITIES                                                                                               |   |   | 460.5   |   |   |   | 581.0 |   |
| STOCKHOLDERS’      EQUITY                                                                                                |   |   |    |   |   |   |   |   |
| Common      stock (outstanding: December 31, 2008 – 60,092,726 shares; December      31, 2007 – 62,923,723 shares) |   |   | 30.0    |   |   |   | 31.5 |   |
| Capital      in excess of par value                                                                                            |   |   | 14.3    |   |   |   | 27.0 |   |
| Retained      earnings                                                                                                         |   |   | 1,536.8 |   |   |   | 1,498.5 |   |
| Accumulated      other comprehensive income (loss)                                                                             |   |   | (456.3  | )      |   |   | (98.3 | ) |
| TOTAL      STOCKHOLDERS’ EQUITY                                                                                          |   |   | 1,124.8 |   |   |   | 1,458.7 |   |
|                                                                                                                           |   | $      | 5,183.3 |   |   | $      | 5,410.9 |   |

----

|                                                                                               |   | OUTSTANDINGCOMMONSHARES |        |   | PARVALUE |   |    | CAPITAL      INEXCESS      OFPAR      VALUE |   | RETAINEDEARNINGS |    |   | ACCUMULATEDOTHERCOMPREHENSIVEINCOME      (LOSS) |    |   | TOTALSTOCKHOLDERS’EQUITY |   |
|----------------------------------------------------------------------------------------------------|--------|-------------------------|-------------|--------|----------|--------|---------|---------------------------------------------|--------|------------------|---------|--------|-------------------------------------------------|---------|--------|--------------------------------|--------|
| BALANCE      AT DECEMBER 31, 2005                                                                  |   |                    | 77,357,370  |   |     | $      | 38.7    |                                        |   | $                | 398.8   |   | $                                               | 1,511.4 |   |                           | $      | (385.7 | ) |   | $ | 1,563.2 |   |
| Comprehensive      income (loss):                                                                  |   |                    |        |   |     |   |    |                                        |   |             |    |   |                                            |    |   |                           |   |   |   |   |   |   |   |
| Net      earnings                                                                                  |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | 486.1   |   |                           |   | — |   |   |   | 486.1 |   |
| Net      loss on derivative instruments (net of tax)                                               |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | (8.8 | ) |   |   | (8.8 | ) |
| Minimum      pension liability adjustment (net of tax)                                             |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | 80.5 |   |   |   | 80.5 |   |
| Foreign      currency translation adjustments, less effect of hedging activities (net      of tax) |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | 70.3 |   |   |   | 70.3 |   |
| Comprehensive      income                                                                          |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | 486.1   |   |                           |   | 142.0 |   |   |   | 628.1 |   |
| Adoption      of FASB Statement No. 158 (net of tax)                                               |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | (99.1 | ) |   |   | (99.1 | ) |
| Cash      dividends on common stock ($1.52 per share)                                              |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | (109.1  | )      |                           |   | — |   |   |   | (109.1 | ) |
| Common      stock issued under stock-based plans (net of forfeitures)                              |   |                    | 1,131,173   |   |     |   | .6      |                                        |   |             | 75.9    |   |                                            | — |   |                           |   | — |   |   |   | 76.5 |   |
| Purchase      and retirement of common stock                                                       |   |                    | (11,753,700 | )      |     |   | (5.9    | )                                           |   |             | (474.7  | )      |                                            | (415.4  | )      |                           |   | — |   |   |   | (896.0 | ) |
| BALANCE      AT DECEMBER 31, 2006                                                                  |   |                    | 66,734,843  |   |     |   | 33.4    |                                        |   |             | — |   |                                            | 1,473.0 |   |                           |   | (342.8 | ) |   |   | 1,163.6 |   |
| Comprehensive      income (loss):                                                                  |   |                    |        |   |     |   |    |                                        |   |             |    |   |                                            |    |   |                           |   |   |   |   |   |   |   |
| Net      earnings                                                                                  |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | 518.1   |   |                           |   | — |   |   |   | 518.1 |   |
| Net      loss on derivative instruments (net of tax)                                               |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | (25.4 | ) |   |   | (25.4 | ) |
| Minimum      pension liability adjustment (net of tax)                                             |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | 161.0 |   |   |   | 161.0 |   |
| Foreign      currency translation adjustments, less effect of hedging activities (net      of tax) |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | 83.2 |   |   |   | 83.2 |   |
| Amortization      of actuarial losses and prior service cost (net of tax)                          |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | 25.7 |   |   |   | 25.7 |   |
| Comprehensive      income                                                                          |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | 518.1   |   |                           |   | 244.5 |   |   |   | 762.6 |   |
| Cumulative      effect of adopting FASB Interpretation No. 48                                      |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | (7.3    | )      |                           |   | — |   |   |   | (7.3 | ) |
| Cash      dividends on common stock ($1.68 per share)                                              |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | (108.6  | )      |                           |   | — |   |   |   | (108.6 | ) |
| Common      stock issued under stock-based plans (net of forfeitures)                              |   |                    | 1,666,123   |   |     |   | .8      |                                        |   |             | 109.0   |   |                                            | — |   |                           |   | — |   |   |   | 109.8 |   |
| Purchase      and retirement of common stock                                                       |   |                    | (5,477,243  | )      |     |   | (2.7    | )                                           |   |             | (82.0   | )      |                                            | (376.7  | )      |                           |   | — |   |   |   | (461.4 | ) |
| BALANCE      AT DECEMBER 31, 2007                                                                  |   |                    | 62,923,723  |   |     |   | 31.5    |                                        |   |             | 27.0    |   |                                            | 1,498.5 |   |                           |   | (98.3 | ) |   |   | 1,458.7 |   |
| Comprehensive      income (loss):                                                                  |   |                    |        |   |     |   |    |                                        |   |             |    |   |                                            |    |   |                           |   |   |   |   |   |   |   |
| Net      earnings                                                                                  |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | 293.6   |   |                           |   | — |   |   |   | 293.6 |   |
| Net      gain on derivative instruments (net of tax)                                               |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | 83.5 |   |   |   | 83.5 |   |
| Minimum      pension liability adjustment (net of tax)                                             |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | (284.2 | ) |   |   | (284.2 | ) |
| Foreign      currency translation adjustments, less effect of hedging activities (net      of tax) |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | (172.1 | ) |   |   | (172.1 | ) |
| Amortization      of actuarial losses and prior service cost (net of tax)                          |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | — |   |                           |   | 14.8 |   |   |   | 14.8 |   |
| Comprehensive      income (loss)                                                                   |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | 293.6   |   |                           |   | (358.0 | ) |   |   | (64.4 | ) |
| Adoption      of FASB Statement No. 158 (net of tax)                                               |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | (5.1    | )      |                           |   | — |   |   |   | (5.1 | ) |
| Cash      dividends on common stock ($1.68 per share)                                              |   |                    | —     |   |     |   | — |                                        |   |             | — |   |                                            | (101.8  | )      |                           |   | — |   |   |   | (101.8 | ) |
| Common      stock issued under stock-based plans (net of forfeitures)                              |   |                    | 305,647     |   |     |   | .1      |                                        |   |             | 39.6    |   |                                            | — |   |                           |   | — |   |   |   | 39.7 |   |
| Purchase      and retirement of common stock                                                       |   |                    | (3,136,644  | )      |     |   | (1.6    | )                                           |   |             | (52.3   | )      |                                            | (148.4  | )      |                           |   | — |   |   |   | (202.3 | ) |
| BALANCE      AT DECEMBER 31, 2008                                                                  |   |                    | 60,092,726  |   |     | $      | 30.0    |                                        |   | $                | 14.3    |   | $                                               | 1,536.8 |   |                           | $      | (456.3 | ) |   | $ | 1,124.8 |   |

----

| YEAR      ENDED DECEMBER 31,                                                                                   |   | 2008   |    |   | 2007   |   |    | 2006   |   |
|----------------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| OPERATING      ACTIVITIES                                                                                      |   |   |    |   |   |   |    |   |   |
| Net      earnings                                                                                              |   | $      | 293.6   |   |   | $      | 518.1   |   |   |  $ | 486.1 |   |
| Adjustments      to reconcile net earnings to cash flow from      operating activities:                        |   |   |    |   |   |   |    |   |   |   |   |   |
| Non-cash      charges and credits:                                                                             |   |   |    |   |   |   |    |   |   |   |   |   |
| Depreciation      and amortization                                                                             |   |   | 136.6   |   |   |   | 143.4   |   |   |   | 154.9 |   |
| Stock-based      compensation                                                                                  |   |   | 29.1    |   |   |   | 25.9    |   |   |   | 29.2 |   |
| Amortization      of actuarial losses and prior service costs                                                  |   |   | 14.8    |   |   |   | 25.7    |   |   |   | 28.9 |   |
| Settlement      of income tax litigation                                                                       |   |   | — |   |   |   | (153.4  | )      |   |   | — |   |
| Restructuring      and exit costs                                                                              |   |   | 54.7    |   |   |   | 19.0    |   |   |   | — |   |
| Other                                                                                                          |   |   | .3      |   |   |   | .5      |   |   |   | .9 |   |
| Changes      in selected working capital items (net      of effects of businesses acquired):                   |   |   |    |   |   |   |    |   |   |   |   |   |
| Trade      receivables                                                                                         |   |   | 132.5   |   |   |   | 99.4    |   |   |   | 36.1 |   |
| Inventories                                                                                                    |   |   | 67.9    |   |   |   | (32.0   | )      |   |   | 57.5 |   |
| Trade      accounts payable                                                                                    |   |   | (47.9   | )      |   |   | 32.6    |   |   |   | (25.1 | ) |
| Other      current liabilities                                                                                 |   |   | (141.8  | )      |   |   | 33.3    |   |   |   | (197.4 | ) |
| Restructuring      spending                                                                                    |   |   | (25.3   | )      |   |   | (1.0    | )      |   |   | (1.7 | ) |
| Other      assets and liabilities                                                                              |   |   | (89.1   | )      |   |   | 14.4    |   |   |   | 53.3 |   |
| CASH      FLOW FROM OPERATING ACTIVITIES                                                                       |   |   | 425.4   |   |   |   | 725.9   |   |   |   | 622.7 |   |
| INVESTING      ACTIVITIES                                                                                      |   |   |    |   |   |   |    |   |   |   |   |   |
| Capital      expenditures                                                                                      |   |   | (98.8   | )      |   |   | (116.4  | )      |   |   | (104.6 | ) |
| Proceeds      from disposal of assets                                                                          |   |   | 20.4    |   |   |   | 13.0    |   |   |   | 14.7 |   |
| Purchase      of businesses, net of cash acquired                                                              |   |   | (25.7   | )      |   |   | — |   |   |   | (158.5 | ) |
| Reduction      in purchase price of previously acquired business                                               |   |   | — |   |   |   | — |   |   |   | 16.1 |   |
| Cash      inflow from hedging activities                                                                       |   |   | 72.4    |   |   |   | 2.0     |   |   |   | 1.4 |   |
| Cash      outflow from hedging activities                                                                      |   |   | (29.7   | )      |   |   | (47.4   | )      |   |   | (14.8 | ) |
| Other      investing activities, net                                                                           |   |   | — |   |   |   | (1.0    | )      |   |   | 4.7 |   |
| CASH      FLOW FROM INVESTING ACTIVITIES                                                                       |   |   | (61.4   | )      |   |   | (149.8  | )      |   |   | (241.0 | ) |
| FINANCING      ACTIVITIES                                                                                      |   |   |    |   |   |   |    |   |   |   |   |   |
| Net      (decrease) increase in short-term borrowings                                                          |   |   | (246.0  | )      |   |   | 68.8    |   |   |   | (309.3 | ) |
| Proceeds      from issuance of long-term debt (net      of debt issue costs of $.3 for 2008 and $2.4 for 2006) |   |   | 224.7   |   |   |   | — |   |   |   | 296.4 |   |
| Payments      on long-term debt                                                                                |   |   | (.2     | )      |   |   | (150.3  | )      |   |   | (155.1 | ) |
| Purchase      of common stock                                                                                  |   |   | (202.3  | )      |   |   | (461.4  | )      |   |   | (896.0 | ) |
| Issuance      of common stock                                                                                  |   |   | 8.6     |   |   |   | 83.3    |   |   |   | 48.2 |   |
| Cash      dividends                                                                                            |   |   | (101.8  | )      |   |   | (108.6  | )      |   |   | (109.1 | ) |
| CASH      FLOW FROM FINANCING ACTIVITIES                                                                       |   |   | (317.0  | )      |   |   | (568.2  | )      |   |   | (1,124.9 | ) |
| Effect      of exchange rate changes on cash                                                                   |   |   | (23.9   | )      |   |   | 13.5    |   |   |   | 8.9 |   |
| INCREASE      (DECREASE) IN CASH AND CASH EQUIVALENTS                                                          |   |   | 23.1    |   |   |   | 21.4    |   |   |   | (734.3 | ) |
| Cash      and cash equivalents at beginning of year                                                            |   |   | 254.7   |   |   |   | 233.3   |   |   |   | 967.6 |   |
| CASH      AND CASH EQUIVALENTS AT END OF YEAR                                                                  |   | $      | 277.8   |   |   | $      | 254.7   |   |   | $ | 233.3 |   |

----

----

----

----

----

| AS      OF DECEMBER 31, 2008 |   | BUY    |    |   | SELL   |   |
|------------------------------|--------|--------|---------|--------|--------|--------|
| United      States dollar    |   | $      | 416.7   |   |   | $      | (21.5 | ) |
| Pound      sterling          |   |   | — |   |   |   | (49.5 | ) |
| Euro                         |   |   | 111.5   |   |   |   | (194.2 | ) |
| Canadian      dollar         |   |   | — |   |   |   | (199.7 | ) |
| Australian      dollar       |   |   | — |   |   |   | (6.5 | ) |
| Czech      koruna            |   |   | 33.4    |   |   |   | — |   |
| Swedish      krona           |   |   | — |   |   |   | (25.9 | ) |
| Norwegian      krone         |   |   | — |   |   |   | (14.9 | ) |
| Other                        |   |   | 21.6    |   |   |   | (6.1 | ) |
| Total                        |   | $      | 583.2   |   |   | $      | (518.3 | ) |
|                         |   |   |    |   |   |   |   |   |
| AS      OF DECEMBER 31, 2007 |   |   |    |   |   |   |   |   |
| Total                        |   | $      | 781.7   |   |   | $      | (810.6 | ) |

| AS      OF DECEMBER 31, 2008 |   | BUY    |    |   | SELL   |   |
|------------------------------|--------|--------|---------|--------|--------|--------|
| United      States dollar    |   | $      | 689.7   |   |   | $      | (1,508.3 | ) |
| Pound      sterling          |   |   | 802.8   |   |   |   | (167.4 | ) |
| Euro                         |   |   | 619.8   |   |   |   | (518.8 | ) |
| Canadian      dollar         |   |   | .6      |   |   |   | (62.8 | ) |
| Japanese      yen            |   |   | 24.4    |   |   |   | (32.2 | ) |
| Swedish      krona           |   |   | 94.3    |   |   |   | (72.5 | ) |
| Swiss      franc             |   |   | 2.2     |   |   |   | (17.1 | ) |
| Norwegian      krone         |   |   | 1.7     |   |   |   | (5.7 | ) |
| Danish      krone            |   |   | 1.6     |   |   |   | (35.1 | ) |
| Other                        |   |   | 24.3    |   |   |   | (14.3 | ) |
| Total                        |   | $      | 2,261.4 |   |   | $      | (2,434.2 | ) |
|                         |   |   |    |   |   |   |   |   |
| AS      OF DECEMBER 31, 2007 |   |   |    |   |   |   |   |   |
| Total                        |   | $      | 2,489.5 |   |   | $      | (2,491.1 | ) |

----

| AS      OF DECEMBER 31, |   | 2008   |   |   | 2007   |   |
|-------------------------|--------|--------|--------|--------|--------|--------|
| Zinc                    |   |   | 13.7   |   |   |   | 11.7 |   |
| Copper                  |   |   | 3.3    |   |   |   | 2.7 |   |

----

----

|                                          |   |   |   |
|-----------------------------------------------|--------|--------|--------|
| Accounts      receivable                      |   | $      | 18.8   |   |
| Inventories                                   |   |   | 42.5   |   |
| Property      and equipment                   |   |   | 2.6    |   |
| Goodwill                                      |   |   | 80.0   |   |
| Intangible      assets                        |   |   | 30.9   |   |
| Other      current and long-term assets       |   |   | 9.1    |   |
| Total      assets acquired                    |   |   | 183.9  |   |
| Accounts      payable and accrued liabilities |   |   | 16.6   |   |
| Other      liabilities                        |   |   | 8.8    |   |
| Total      liabilities                        |   |   | 25.4   |   |
| Fair      value of net assets acquired        |   | $      | 158.5  |   |

----

|                                                   |   | 2008   |    |   | 2007   |   |
|--------------------------------------------------------|--------|--------|---------|--------|--------|--------|
| FIFO      cost                                         |   |   |    |   |   |   |
| Raw      materials and work-in-process                 |   | $      | 263.9   |   |   | $      | 275.4 |   |
| Finished      products                                 |   |   | 783.8   |   |   |   | 885.2 |   |
|                                                   |   |   | 1,047.7 |   |   |   | 1,160.6 |   |
| Adjustment      to arrive at LIFO      inventory value |   |   | (23.5   | )      |   |   | (14.8 | ) |
|                                                   |   | $      | 1,024.2 |   |   | $      | 1,145.8 |   |

|                                         |   | 2008   |    |   | 2007   |   |
|----------------------------------------------|--------|--------|---------|--------|--------|--------|
| Property,      plant, and equipment at cost: |   |   |    |   |   |   |
| Land      and improvements                   |   | $      | 41.3    |   |   | $      | 43.8 |   |
| Buildings                                    |   |   | 299.7   |   |   |   | 308.0 |   |
| Machinery      and equipment                 |   |   | 1,288.9 |   |   |   | 1,435.8 |   |
|                                         |   |   | 1,629.9 |   |   |   | 1,787.6 |   |
| Less      accumulated depreciation           |   |   | 1,102.0 |   |   |   | 1,191.4 |   |
|                                         |   | $      | 527.9   |   |   | $      | 596.2 |   |

|                                                 |   | POWER      TOOLS      & ACCESSORIES |    |   | HARDWARE&      HOME IMPROVEMENT |   |    | FASTENING      & ASSEMBLY SYSTEMS |   |   | TOTAL   |   |
|------------------------------------------------------|--------|-----------------------------------------|---------|--------|-------------------------------------|--------|---------|-------------------------------------------------|--------|--------|---------|--------|
| Balance      at January 1, 2007                      |   | $                                       | 437.1   |   |                                | $      | 463.8   |                                            |   | $      | 294.7   |   |   | $ | 1,195.6 |   |
| Acquisition                                          |   |                                    | — |   |                                |   | — |                                            |   |   | .5      |   |   |   | .5 |   |
| Activity      associated with prior year acquisition |   |                                    | (4.1    | )      |                                |   | — |                                            |   |   | — |   |   |   | (4.1 | ) |
| Currency      translation adjustment                 |   |                                    | 3.4     |   |                                |   | .6      |                                            |   |   | 16.9    |   |   |   | 20.9 |   |
| Balance      at December 31, 2007                    |   |                                    | 436.4   |   |                                |   | 464.4   |                                            |   |   | 312.1   |   |   |   | 1,212.9 |   |
| Acquisition                                          |   |                                    | — |   |                                |   | — |                                            |   |   | 13.9    |   |   |   | 13.9 |   |
| Currency      translation adjustment                 |   |                                    | (3.5    | )      |                                |   | (1.0    | )                                               |   |   | .9      |   |   |   | (3.6 | ) |
| Balance      at December 31, 2008                    |   | $                                       | 432.9   |   |                                | $      | 463.4   |                                            |   | $      | 326.9   |   |   | $ | 1,223.2 |   |

----

|                                                                                                       |   | 2008   |   |   | 2007   |   |
|------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Customer      relationships (net      of accumulated amortization of      $15.7 in 2008 and $10.3 in 2007) |   | $      | 56.9   |   |   | $      | 53.0 |   |
| Technology      and patents (net      of accumulated amortizationof      $9.5 in 2008 and $7.0 in 2007)    |   |   | 14.2   |   |   |   | 14.2 |   |
| Trademarks      and trade names(net      of accumulated amortizationof      $5.6 in 2008 and $3.7 in 2007) |   |   | 206.5  |   |   |   | 208.4 |   |
| Total      intangibles, net                                                                                |   | $      | 277.6  |   |   | $      | 275.6 |   |

|                                        |   | 2008   |   |   | 2007   |   |
|---------------------------------------------|--------|--------|--------|--------|--------|--------|
| Trade      discounts and allowances         |   | $      | 202.8  |   |   | $      | 239.7 |   |
| Employee      benefits                      |   |   | 128.8  |   |   |   | 155.2 |   |
| Salaries      and wages                     |   |   | 81.1   |   |   |   | 92.0 |   |
| Advertising      and promotion              |   |   | 37.8   |   |   |   | 52.4 |   |
| Warranty                                    |   |   | 55.2   |   |   |   | 60.5 |   |
| Income      taxes, including deferred taxes |   |   | 102.0  |   |   |   | 88.8 |   |
| All      other                              |   |   | 339.7  |   |   |   | 357.7 |   |
|                                        |   | $      | 947.4  |   |   | $      | 1,046.3 |   |

|                                                                                                                       |   | 2008   |   |   | 2007   |   |
|----------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Warranty      reserve at January 1                                                                                         |   | $      | 60.5   |   |   | $      | 60.2 |   |
| Accruals      for warranties issued duringthe      period and changes in estimates related      to pre-existing warranties |   |   | 123.0  |   |   |   | 118.8 |   |
| Settlements      made                                                                                                      |   |   | (125.1 | )      |   |   | (120.9 | ) |
| Currency      translation adjustments                                                                                      |   |   | (3.2   | )      |   |   | 2.4 |   |
| Warranty      reserve at December 31                                                                                       |   | $      | 55.2   |   |   | $      | 60.5 |   |

----

|                                                                                      |   | 2008   |    |   | 2007   |   |
|-------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|
| 7.125%      notes due 2011 (including      discount of $.7      in 2008 and $1.1 in 2007) |   | $      | 399.3   |   |   | $      | 398.9 |   |
| 4.75%      notes due 2014 (including      discount of $1.3      in 2008 and $1.5 in 2007) |   |   | 298.7   |   |   |   | 298.5 |   |
| 5.75%      notes due 2016 (including      discount of $1.0      in 2008 and $1.1 in 2007) |   |   | 299.0   |   |   |   | 298.9 |   |
| 7.05%      notes due 2028                                                                 |   |   | 150.0   |   |   |   | 150.0 |   |
| Other      loans due through 2012                                                         |   |   | 225.0   |   |   |   | .3 |   |
| Fair      value hedging adjustment                                                        |   |   | 72.8    |   |   |   | 32.7 |   |
| Less      current maturities of      long-term debt                                       |   |   | (.1     | )      |   |   | (.2 | ) |
|                                                                                      |   | $      | 1,444.7 |   |   | $      | 1,179.1 |   |

----

----

|         |   | QUOTED      PRICESIN      ACTIVE MARKETS      FOR IDENTICAL ASSETS (LEVEL      1) |    |   | SIGNIFICANTOTHEROBSERVABLEINPUTS (LEVEL      2) |   |     | FIN      39 NETTING | (a)  |   | DECEMBER 31,2008 |   |
|--------------|--------|--------------------------------------------------------------------------------------------------|---------|--------|------------------------------------------------------|--------|----------|--------------------------|-----------|--------|-----------------------|--------|
| Assets:      |   |                                                                                             |    |   |                                                 |   |     |                     |      |   |                  |   |
| Investments  |   | $                                                                                                | 45.8    |   |                                                 | $      | 21.7     |                     |      | $      | —               |   |   | $ | 67.5 |   |
| Derivatives  |   |                                                                                             | — |   |                                                 |   | 402.7    |                     |      |   | (219.3                | )      |   |   | 183.4 |   |
| Liabilities: |   |                                                                                             |    |   |                                                 |   |     |                     |      |   |                  |   |   |   |   |   |
| Derivatives  |   |                                                                                             | (7.7    | )      |                                                 |   | (261.6   | )                        |      |   | 219.3                 |   |   |   | (50.0 | )  |
| Debt         |   |                                                                                             | — |   |                                                 |   | (1,370.8 | )                   |      |   | —               |   |   |   | (1,370.8 | )  |

| (a)   | FASB      Interpretation No. 39 (FIN 39), Offsetting      of Amounts Related to Certain Contracts, permits the netting of      derivative receivables and derivative payables when a legally enforceable      master netting arrangementexists. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ASSETS      (LIABILITIES)     |   | CARRYINGAMOUNT |     |   | FAIRVALUE |   |
|-------------------------------|--------|----------------|----------|--------|-----------|--------|
| Non-derivatives:              |   |           |     |   |      |   |
| Investments                   |   | $              | 90.8     |   |      | $      | 90.8 |   |
| Long-term      debt           |   |           | (1,179.1 | )      |      |   | (1,146.1 | ) |
| Derivatives      relating to: |   |           |     |   |      |   |   |   |
| Debt                          |   |           |     |   |      |   |   |   |
| Assets                        |   |           | 11.6     |   |      |   | 11.6 |   |
| Foreign      Currency         |   |           |     |   |      |   |   |   |
| Assets                        |   |           | 18.0     |   |      |   | 18.0 |   |
| Liabilities                   |   |           | (44.0    | )      |      |   | (44.0 | ) |

|                 |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|----------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| United      States   |   | $      | .4     |   |   | $      | 97.2   |   |   | $ | 295.7 |   |
| Other      countries |   |   | 364.3  |   |   |   | 400.4  |   |   |   | 368.7 |   |
|                 |   | $      | 364.7  |   |   | $      | 497.6  |   |   | $ | 664.4 |   |

|                 |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|----------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Current:             |   |   |   |   |   |   |   |   |   |
| United      States   |   | $      | (6.1   | )      |   | $      | (65.5  | )      |   | $ | 135.4 |   |
| Other      countries |   |   | 69.8   |   |   |   | 68.6   |   |   |   | 61.1 |   |
|                 |   |   | 63.7   |   |   |   | 3.1    |   |   |   | 196.5 |   |
| Deferred:            |   |   |   |   |   |   |   |   |   |   |   |   |
| United      States   |   |   | 3.2    |   |   |   | (16.3  | )      |   |   | (11.9 | ) |
| Other      countries |   |   | 4.2    |   |   |   | (7.3   | )      |   |   | (6.3 | ) |
|                 |   |   | 7.4    |   |   |   | (23.6  | )      |   |   | (18.2 | ) |
|                 |   | $      | 71.1   |   |   | $      | (20.5  | )      |   | $ | 178.3 |   |

----

|                                        |   | 2008    |   |   | 2007   |    |
|---------------------------------------------|--------|---------|--------|--------|--------|---------|
| Deferred      tax liabilities:              |   |    |   |   |   |    |
| Other                                       |   |  $ | (80.4  | )      |   |  $ | (63.4 | ) |
| Gross      deferred tax liabilities         |   |    | (80.4  | )      |   |    | (63.4 | ) |
| Deferred      tax assets:                   |   |    |   |   |   |    |   |   |
| Tax      loss carryforwards                 |   |    | 36.2   |   |   |    | 80.5 |   |
| Postretirement      benefits                |   |    | 209.1  |   |   |    | 65.3 |   |
| Environmental      remediation matters      |   |    | 34.7   |   |   |    | 36.0 |   |
| Stock-based      compensation               |   |    | 40.7   |   |   |    | 33.3 |   |
| Other                                       |   |    | 163.9  |   |   |    | 193.3 |   |
| Gross      deferred tax assets              |   |    | 484.6  |   |   |    | 408.4 |   |
| Deferred      tax asset valuation allowance |   |    | (27.6  | )      |   |    | (25.9 | ) |
| Net      deferred tax assets                |   | $       | 376.6  |   |   |  $ | 319.1 |   |

|                                                           |   | 2008   |    |    | 2007   |    |   | 2006   |   |
|----------------------------------------------------------------|--------|--------|---------|---------|--------|---------|--------|--------|--------|
| Income      taxes at federal statutory      rate               |   | $      | 127.6   |    |   | $       | 174.2  |   |   | $ | 232.5 |   |
| Settlement      of tax litigation                              |   |   | — |    |   |    | (153.4 | )      |   |   | — |   |
| Lower      effective taxes on earnings      in other countries |   |   | (59.5   | )  |   |    | (53.6  | )      |   |   | (59.0 | ) |
| Other –      net                                    |   |   | 3.0     |    |   |    | 12.3   |   |   |   | 4.8 |   |
| Income      taxes (benefit)                                    |   | $      | 71.1    |    |   |  $ | (20.5  | )      |   |  $ | 178.3 |   |

|                                                               |   | 2008   |   |    | 2007   |   |
|--------------------------------------------------------------------|--------|--------|--------|---------|--------|--------|
| Balance      at January 1                                          |   | $      | 317.4  |    |   | $      | 359.5 |   |
| Additions      based on tax positions related      to current year |   |   | 33.9   |    |   |   | 35.2 |   |
| Additions      for tax positions related to      prior years       |   |   | 65.5   |    |   |   | 63.0 |   |
| Reductions      for tax positions related to      prior years      |   |   | (40.3  | )       |   |   | (115.0 | ) |
| Settlements      (payments)                                        |   |   | (57.0  | )       |   |   | (26.2 | ) |
| Expiration      of the statute of limitations                      |   |   | (75.1  | )       |   |   | (13.5 | ) |
| Foreign      currency translation adjustment                       |   |   | (12.9  | )  |   |   | 14.4 |   |
| Balance      at December 31                                        |   | $      | 231.5  |    |   | $      | 317.4 |   |

----

----

|                                                                                                          |   | 2008                                                       |    |   | 2007                                                                        |   |
|---------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------|---------|--------|-----------------------------------------------------------------------------|--------|
|                                                                                                          |   | PENSION BENEFITS PLANS IN      THE UNITED STATES |    |   | PENSION BENEFITS      PLANS      OUTSIDEOF      THE UNITED STATES |   |   | OTHER      POST-RETIREMENT      BENEFITS      ALL      PLANS |   |   | PENSION      BENEFITS      PLANS IN      THE UNITED STATES |   |   | PENSION      BENEFITS      PLANS      OUTSIDEOF      THE UNITED STATES |   |   | OTHER POST-RETIREMENT      BENEFITS      ALL      PLANS |   |
| CHANGE      IN BENEFIT OBLIGATION                                                                             |   |                                                       |    |   |                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Benefit      obligation at beginning of year                                                                  |   | $                                                          | 1,013.2 |   |                                                                        | $      | 793.1 |   |   | $ | 86.9 |   |   | $ | 1,074.8 |   |   | $ | 794.0 |   |   | $ | 88.8 |   |
| Service      cost                                                                                             |   |                                                       | 26.1    |   |                                                                        |   | 14.7 |   |   |   | .8 |   |   |   | 24.8 |   |   |   | 14.7 |   |   |   | .8 |   |
| Interest      cost                                                                                            |   |                                                       | 78.1    |   |                                                                        |   | 49.1 |   |   |   | 4.9 |   |   |   | 62.5 |   |   |   | 39.6 |   |   |   | 5.3 |   |
| Curtailment      gain                                                                                         |   |                                                       | (1.1    | )      |                                                                        |   | (1.5 | ) |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Plan      participants’ contributions                                                                   |   |                                                       | — |   |                                                                        |   | 1.6 |   |   |   | 3.3 |   |   |   | — |   |   |   | 1.4 |   |   |   | 3.6 |   |
| Actuarial      (gains) losses                                                                                 |   |                                                       | (21.9   | )      |                                                                        |   | (96.7 | ) |   |   | 3.4 |   |   |   | (83.5 | ) |   |   | (76.6 | ) |   |   | 2.4 |   |
| Foreign      currency exchange rate changes                                                                   |   |                                                       | — |   |                                                                        |   | (182.3 | ) |   |   | (1.9 | ) |   |   | — |   |   |   | 54.2 |   |   |   | 1.1 |   |
| Benefits      paid                                                                                            |   |                                                       | (82.1   | )      |                                                                        |   | (46.6 | ) |   |   | (15.6 | ) |   |   | (65.4 | ) |   |   | (34.3 | ) |   |   | (15.1 | ) |
| Plan      amendments                                                                                          |   |                                                       | — |   |                                                                        |   | — |   |   |   | (.4 | ) |   |   | — |   |   |   | .1 |   |   |   | — |   |
| Benefit      obligation at end of year                                                                        |   |                                                       | 1,012.3 |   |                                                                        |   | 531.4 |   |   |   | 81.4 |   |   |   | 1,013.2 |   |   |   | 793.1 |   |   |   | 86.9 |   |
| CHANGE      IN PLAN ASSETS                                                                                    |   |                                                       |    |   |                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair      value of plan assets at beginning of year                                                           |   |                                                       | 987.8   |   |                                                                        |   | 643.6 |   |   |   | — |   |   |   | 914.2 |   |   |   | 566.0 |   |   |   | — |   |
| Actual      return/(loss) on plan assets                                                                      |   |                                                       | (297.1  | )      |                                                                        |   | (119.6 | ) |   |   | — |   |   |   | 139.0 |   |   |   | 58.8 |   |   |   | — |   |
| Expenses                                                                                                      |   |                                                       | (9.2    | )      |                                                                        |   | (2.1 | ) |   |   | — |   |   |   | (6.5 | ) |   |   | (1.5 | ) |   |   | — |   |
| Benefits      paid                                                                                            |   |                                                       | (82.1   | )      |                                                                        |   | (44.5 | ) |   |   | (15.6 | ) |   |   | (65.4 | ) |   |   | (32.8 | ) |   |   | (15.1 | ) |
| Employer      contributions                                                                                   |   |                                                       | 7.0     |   |                                                                        |   | 21.4 |   |   |   | 12.3 |   |   |   | 6.5 |   |   |   | 16.0 |   |   |   | 11.5 |   |
| Contributions      by plan participants                                                                       |   |                                                       | — |   |                                                                        |   | 1.6 |   |   |   | 3.3 |   |   |   | — |   |   |   | 1.4 |   |   |   | 3.6 |   |
| Foreign      currency exchange rate changes                                                                   |   |                                                       | — |   |                                                                        |   | (156.8 | ) |   |   | — |   |   |   | — |   |   |   | 35.7 |   |   |   | — |   |
| Fair      value of plan assets at end of year                                                                 |   |                                                       | 606.4   |   |                                                                        |   | 343.6 |   |   |   | — |   |   |   | 987.8 |   |   |   | 643.6 |   |   |   | — |   |
| Funded      status                                                                                            |   |                                                       | (405.9  | )      |                                                                        |   | (187.8 | ) |   |   | (81.4 | ) |   |   | (25.4 | ) |   |   | (149.5 | ) |   |   | (86.9 | ) |
| Contributions      subsequent to measurement date                                                             |   |                                                       | — |   |                                                                        |   | — |   |   |   | — |   |   |   | .1 |   |   |   | 4.5 |   |   |   | — |   |
| Accrued      benefit cost at December 31                                                                      |   | $                                                          | (405.9  | )      |                                                                        | $      | (187.8 | ) |   | $ | (81.4 | ) |   | $ | (25.3 | ) |   | $ | (145.0 | ) |   | $ | (86.9 | ) |
| AMOUNTS      RECOGNIZED IN THE      CONSOLIDATED      BALANCE      SHEET                                      |   |                                                       |    |   |                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Noncurrent      assets                                                                                        |   | $                                                          | 17.5    |   |                                                                        | $      | — |   |   | $ | — |   |   | $ | 75.6 |   |   | $ | .9 |   |   | $ | — |   |
| Current      liabilities                                                                                      |   |                                                       | (8.6    | )      |                                                                        |   | (5.3 | ) |   |   | (9.3 | ) |   |   | (7.6 | ) |   |   | (5.2 | ) |   |   | (9.6 | ) |
| Postretirement      benefits                                                                                  |   |                                                       | (414.8  | )      |                                                                        |   | (182.5 | ) |   |   | (72.1 | ) |   |   | (93.3 | ) |   |   | (140.7 | ) |   |   | (77.3 | ) |
| Net      amount recognized at December 31                                                                     |   | $                                                          | (405.9  | )      |                                                                        | $      | (187.8 | ) |   | $ | (81.4 | ) |   | $ | (25.3 | ) |   | $ | (145.0 | ) |   | $ | (86.9 | ) |
| WEIGHTED-AVERAGE      ASSUMPTIONS USED      TO DETERMINE BENEFIT OBLIGATIONS      AS OF MEASUREMENT      DATE |   |                                                       |    |   |                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Discount      rate                                                                                            |   |                                                       | 6.75    | %      |                                                                        |   | 6.16 | % |   |   | 6.25 | % |   |   | 6.50 | % |   |   | 5.67 | % |   |   | 6.00 | % |
| Rate      of compensation increase                                                                            |   |                                                       | 3.95    | %      |                                                                        |   | 3.60 | % |   |   | — |   |   |   | 3.95 | % |   |   | 3.65 | % |   |   | — |   |

----

| DECEMBER      31, 2008           |   | PENSION BENEFITS      PLANS      IN      THE UNITED STATES |   |    | PENSION BENEFITS PLANS OUTSIDE OF      THE UNITED      STATES |   |   | OTHER      POST-RETIREMENT      BENEFITS      ALL      PLANS |   |   | TOTAL  |    |
|----------------------------------|--------|----------------------------------------------------------------------|--------|---------|----------------------------------------------------------------------------------------|--------|--------|--------------------------------------------------------------|--------|--------|--------|---------|
| Prior      service (cost) credit |   | $                                                                    | (9.9   | )  |                                                                                   | $      | (5.4   | )                                                       |   | $      | 23.1   |    |   | $ | 7.8 |   |
| Net      loss                    |   |                                                                 | (556.3 | )  |                                                                                   |   | (117.8 | )                                                       |   |   | (15.1  | )  |   |   | (689.2 | )  |
| Total                            |   | $                                                                    | (566.2 | )  |                                                                                   | $      | (123.2 | )                                                       |   | $      | 8.0    |    |   | $ | (681.4 | )  |
|                             |   |                                                                 |   |    |                                                                                   |   |   |                                                         |   |   |   |    |   |   |   |   |
| DECEMBER      31, 2007           |   |                                                                 |   |    |                                                                                   |   |   |                                                         |   |   |   |    |   |   |   |   |
| Prior      service (cost) credit |   | $                                                                    | (11.8  | )  |                                                                                   | $      | (10.8  | )                                                       |   | $      | 26.3   |    |   | $ | 3.7 |   |
| Net      loss                    |   |                                                                 | (196.7 | )  |                                                                                   |   | (93.1  | )                                                       |   |   | (11.8  | )  |   |   | (301.6 | )  |
| Total                            |   | $                                                                    | (208.5 | )  |                                                                                   | $      | (103.9 | )                                                       |   | $      | 14.5   |    |   | $ | (297.9 | )  |

|                             |   | PENSION      BENEFITS      PLANS      IN      THE UNITED      STATES |   |   | PENSION      BENEFITS PLANS      OUTSIDE      OF      THE UNITED STATES |   |    | OTHER      POST-RETIREMENT      BENEFITS      ALL      PLANS |   |   | TOTAL |   |
|----------------------------------|--------|----------------------------------------------------------------------|--------|--------|----------------------------------------------------------------------------------------|--------|---------|--------------------------------------------------------------|--------|--------|-------|--------|
| Prior      service cost (credit) |   | $                                                                    | 1.4    |   |                                                                                   | $      | .9      |                                                         |   | $      | (3.4  | )      |   | $ | (1.1 | ) |
| Net      loss                    |   |                                                                 | 18.4   |   |                                                                                   |   | — |                                                         |   |   | .8    |   |   |   | 19.2 |   |
| Total                            |   | $                                                                    | 19.8   |   |                                                                                   | $      | .9      |                                                         |   | $      | (2.6  | )      |   | $ | 18.1 |   |

|                         |   | 2008   |   |   | 2007   |   |
|------------------------------|--------|--------|--------|--------|--------|--------|
| Equity      Securities       |   |   | 60     | %      |   |   | 69 | % |
| Fixed      Income Securities |   |   | 36     | %      |   |   | 28 | % |
| Alternative      Investments |   |   | 4      | %      |   |   | 3 | % |
|                         |   |   | 100    | %      |   |   | 100 | % |

|                         |   | 2008   |   |   | 2007   |   |
|------------------------------|--------|--------|--------|--------|--------|--------|
| Equity      Securities       |   |   | 60     | %      |   |   | 72 | % |
| Fixed      Income Securities |   |   | 31     | %      |   |   | 20 | % |
| Real      Estate             |   |   | 7      | %      |   |   | 7 | % |
| Other                        |   |   | 2      | %      |   |   | 1 | % |
|                         |   |   | 100    | %      |   |   | 100 | % |

----

|                                                                                                                    |   | PENSION      BENEFITSPLANS      IN THEUNITED      STATES |    |   | PENSION      BENEFITSPLANS      OUTSIDE OF THE UNITED      STATES |   |
|-------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------|---------|--------|------------------------------------------------------------------------|--------|
|                                                                                                                    |   | 2008                                                     |    |   | 2007                                                                   |   |   | 2008 |   |   | 2007 |   |
| All      defined benefit plans:                                                                                         |   |                                                     |    |   |                                                                   |   |   |   |   |   |   |   |
| Accumulated      benefit obligation                                                                                     |   | $                                                        | 958.4   |   |                                                                   | $      | 948.3 |   |   | $ | 504.4 |   |   | $ | 746.4 |   |
| Unfunded      defined benefit plans:                                                                                    |   |                                                     |    |   |                                                                   |   |   |   |   |   |   |   |   |   |   |   |
| Projected      benefit obligation                                                                                       |   |                                                     | 95.3    |   |                                                                   |   | 100.9 |   |   |   | 119.4 |   |   |   | 126.9 |   |
| Accumulated      benefit obligation                                                                                     |   |                                                     | 84.5    |   |                                                                   |   | 82.3 |   |   |   | 110.5 |   |   |   | 116.6 |   |
| Defined      benefit plans with an accumulated benefit obligation      in      excess of the fair value of plan assets: |   |                                                     |    |   |                                                                   |   |   |   |   |   |   |   |   |   |   |   |
| Projected      benefit obligation                                                                                       |   |                                                     | 1,006.1 |   |                                                                   |   | 100.9 |   |   |   | 522.3 |   |   |   | 126.9 |   |
| Accumulated      benefit obligation                                                                                     |   |                                                     | 952.2   |   |                                                                   |   | 82.3 |   |   |   | 496.1 |   |   |   | 116.6 |   |
| Fair      value of plan assets                                                                                          |   |                                                     | 582.7   |   |                                                                   |   | — |   |   |   | 334.6 |   |   |   | — |   |

|      |   | PENSION      BENEFITS      PLANS      IN      THE UNITED      STATES |   |   | PENSION      BENEFITS      PLANS      OUTSIDE      OF      THE UNITED      STATES |   |   | OTHER      POST-RETIREMENT      BENEFITS      ALL      PLANS |   |
|-----------|--------|----------------------------------------------------------------------|--------|--------|-----------------------------------------------------------------------------------|--------|--------|--------------------------------------------------------------|--------|
| 2009      |   | $                                                                    | 74.8   |   |                                                                              | $      | 28.6   |                                                         |   | $ | 9.6 |   |
| 2010      |   |                                                                 | 75.3   |   |                                                                              |   | 29.5   |                                                         |   |   | 9.4 |   |
| 2011      |   |                                                                 | 75.3   |   |                                                                              |   | 30.5   |                                                         |   |   | 9.0 |   |
| 2012      |   |                                                                 | 74.9   |   |                                                                              |   | 31.5   |                                                         |   |   | 8.5 |   |
| 2013      |   |                                                                 | 96.7   |   |                                                                              |   | 32.7   |                                                         |   |   | 8.2 |   |
| 2014-2018 |   |                                                                 | 391.6  |   |                                                                              |   | 178.3  |                                                         |   |   | 36.2 |   |

|                                                                                        |   | PENSION      BENEFITS PLANS      IN THE UNITED      STATES |    |   | PENSION      BENEFITS PLANS      OUTSIDE OF THE UNITED      STATES |   |
|---------------------------------------------------------------------------------------------|--------|------------------------------------------------------------|---------|--------|--------------------------------------------------------------------|--------|
|                                                                                        |   | 2008                                                       |    |   | 2007                                                               |   |   | 2006 |   |   | 2008 |   |   | 2007 |   |   | 2006 |   |
| Service      cost                                                                           |   | $                                                          | 22.6    |   |                                                               | $      | 26.0 |   |   | $ | 24.8 |   |   | $ | 12.3 |   |   | $ | 14.7 |   |   | $ | 14.7 |   |
| Interest      cost                                                                          |   |                                                       | 63.7    |   |                                                               |   | 62.5 |   |   |   | 58.4 |   |   |   | 40.9 |   |   |   | 39.6 |   |   |   | 38.4 |   |
| Expected      return on plan assets                                                         |   |                                                       | (77.9   | )      |                                                               |   | (75.6 | ) |   |   | (76.7 | ) |   |   | (40.1 | ) |   |   | (39.3 | ) |   |   | (34.6 | ) |
| Amortization      of prior service cost                                                     |   |                                                       | 2.1     |   |                                                               |   | 2.1 |   |   |   | 3.3 |   |   |   | 1.4 |   |   |   | 1.7 |   |   |   | 1.7 |   |
| Amortization      of net actuarial loss                                                     |   |                                                       | 15.9    |   |                                                               |   | 26.3 |   |   |   | 24.8 |   |   |   | 4.7 |   |   |   | 12.9 |   |   |   | 17.2 |   |
| Curtailment      loss                                                                       |   |                                                       | — |   |                                                               |   | — |   |   |   | — |   |   |   | 1.1 |   |   |   | — |   |   |   | — |   |
| Net      periodic cost                                                                      |   | $                                                          | 26.4    |   |                                                               | $      | 41.3 |   |   | $ | 34.6 |   |   | $ | 20.3 |   |   | $ | 29.6 |   |   | $ | 37.4 |   |
| WEIGHTED-AVERAGE      ASSUMPTIONS USED      IN DETERMINING NET PERIODIC      COST FOR YEAR: |   |                                                       |    |   |                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Discount      rate                                                                          |   |                                                       | 6.50    | %      |                                                               |   | 6.00 | % |   |   | 5.75 | % |   |   | 5.67 | % |   |   | 4.93 | % |   |   | 4.87 | % |
| Expected      return on plan assets                                                         |   |                                                       | 8.75    | %      |                                                               |   | 8.75 | % |   |   | 8.75 | % |   |   | 7.49 | % |   |   | 7.49 | % |   |   | 7.49 | % |
| Rate      of compensation increase                                                          |   |                                                       | 4.00    | %      |                                                               |   | 3.95 | % |   |   | 4.00 | % |   |   | 3.65 | % |   |   | 3.65 | % |   |   | 3.86 | % |

----

|                                                                                         |   | 2008   |    |   | 2007   |   |    | 2006   |   |
|----------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| Service      cost                                                                            |   | $      | .8      |   |   | $      | .8      |   |   | $ | 1.0 |   |
| Interest      cost                                                                           |   |   | 4.9     |   |   |   | 5.3     |   |   |   | 5.9 |   |
| Amortization      of prior service cost                                                      |   |   | (3.6    | )      |   |   | (4.5    | )      |   |   | (4.6 | ) |
| Amortization      of net actuarial loss                                                      |   |   | .4      |   |   |   | .2      |   |   |   | .9 |   |
| Curtailment      gain                                                                        |   |   | — |   |   |   | — |   |   |   | (.3 | ) |
| Net      periodic cost                                                                       |   | $      | 2.5     |   |   | $      | 1.8     |   |   | $ | 2.9 |   |
| Weighted-average      discount rate used      in determining net      periodic cost for year |   |   | 6.00    | %      |   |   | 6.25    | %      |   |   | 6.00 | % |

| ONE-PERCENTAGE-POINT                                              |   | INCREASE |   |   | (DECREASE) |   |
|-------------------------------------------------------------------|--------|----------|--------|--------|------------|--------|
| Effect      on total of service and interest      cost components |   | $        | .3     |   |       | $      | (.3 | ) |
| Effect      on postretirement benefit      obligation             |   |     | 3.4    |   |       |   | (3.2 | ) |

|                                                            |   | 2008   |   |   | 2007   |   |
|-----------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Foreign      currency translation adjustment                    |   | $      | (65.4  | )      |   | $      | 125.5 |   |
| Net      gain (loss) on derivative instruments, net      of tax |   |   | 55.9   |   |   |   | (27.6 | ) |
| Minimum      pension liability adjustment, net      of tax      |   |   | (446.8 | )      |   |   | (196.2 | ) |
|                                                            |   | $      | (456.3 | )      |   | $      | (98.3 | ) |

----

|  (AMOUNTS      IN MILLIONSEXCEPT      PER SHARE DATA)                                                                          |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|-------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Numerator:                                                                                                                          |   |   |   |   |   |   |   |   |   |
| Net      earnings                                                                                                                   |   | $      | 293.6  |   |   | $      | 518.1  |   |   | $ | 486.1 |   |
| Denominator:                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
| Denominator      for basic earnings      per share –weighted-average      shares                                              |   |   | 59.8   |   |   |   | 64.3   |   |   |   | 72.1 |   |
| Employee      stock options and other      stock-based plans                                                                        |   |   | 1.1    |   |   |   | 1.7    |   |   |   | 2.1 |   |
| Denominator      for diluted earnings      per share –adjusted      weighted-average      shares and assumed      conversions |   |   | 60.9   |   |   |   | 66.0   |   |   |   | 74.2 |   |
| Basic      earnings per share                                                                                                       |   | $      | 4.91   |   |   | $      | 8.06   |   |   | $ | 6.74 |   |
| Diluted      earnings per share                                                                                                     |   | $      | 4.82   |   |   | $      | 7.85   |   |   | $ | 6.55 |   |

|                                      |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|-------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Number      of options (in      millions) |   |   | 2.6    |   |   |   | 1.6    |   |   |   | 1.3 |   |
| Weighted-average      exercise      price |   | $      | 81.39  |   |   | $      | 88.76  |   |   | $ | 86.54 |   |

|                                               |   | STOCK      OPTIONS |       |   | WEIGHTED-AVERAGE      EXERCISE      PRICE |   |
|----------------------------------------------------|--------|--------------------|------------|--------|-------------------------------------------|--------|
| Outstanding      at December 31, 2005              |   |               | 6,271,898  |   |                                      | $      | 49.86 |   |
| Granted                                            |   |               | 774,670    |   |                                      |   | 91.85 |   |
| Exercised                                          |   |               | (871,716   | )      |                                      |   | 43.76 |   |
| Forfeited                                          |   |               | (138,840   | )      |                                      |   | 69.45 |   |
| Outstanding      at December 31, 2006              |   |               | 6,036,012  |   |                                      |   | 55.68 |   |
| Granted                                            |   |               | 790,470    |   |                                      |   | 88.38 |   |
| Exercised                                          |   |               | (1,406,664 | )      |                                      |   | 49.75 |   |
| Forfeited                                          |   |               | (154,788   | )      |                                      |   | 80.80 |   |
| Outstanding      at December 31, 2007              |   |               | 5,265,030  |   |                                      |   | 61.43 |   |
| Granted                                            |   |               | 548,020    |   |                                      |   | 67.11 |   |
| Exercised                                          |   |               | (163,728   | )      |                                      |   | 51.74 |   |
| Forfeited                                          |   |               | (149,128   | )      |                                      |   | 83.80 |   |
| Outstanding      at December 31, 2008              |   |               | 5,500,194  |   |                                      | $      | 61.68 |   |
| Options      expected to vest at December 31, 2008 |   |               | 5,400,130  |   |                                      | $      | 61.35 |   |
| Options      exercisable at December 31, 2008      |   |               | 3,979,000  |   |                                      | $      | 54.27 |   |

----

|                        |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|-----------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Expected      life in years |   |   | 6.0    |   |   |   | 5.5    |   |   |   | 5.4 |   |
| Interest      rate          |   |   | 3.30   | %      |   |   | 4.56   | %      |   |   | 4.96 | % |
| Volatility                  |   |   | 30.7   | %      |   |   | 25.3   | %      |   |   | 25.8 | % |
| Dividend      yield         |   |   | 2.50   | %      |   |   | 1.90   | %      |   |   | 1.66 | % |

|                                 |   | NUMBER      OF      SHARES |     |   | WEIGHTED-AVERAGEFAIR      VALUE AT GRANT      DATE |   |
|--------------------------------------|--------|----------------------------|----------|--------|----------------------------------------------------|--------|
| Non-vested      at December 31, 2005 |   |                       | 437,696  |   |                                               | $      | 67.80 |   |
| Granted                              |   |                       | 230,134  |   |                                               |   | 91.58 |   |
| Forfeited                            |   |                       | (37,093  | )      |                                               |   | 73.18 |   |
| Vested                               |   |                       | (12,699  | )      |                                               |   | 68.44 |   |
| Non-vested      at December 31, 2006 |   |                       | 618,038  |   |                                               |   | 76.32 |   |
| Granted                              |   |                       | 266,537  |   |                                               |   | 88.53 |   |
| Forfeited                            |   |                       | (46,425  | )      |                                               |   | 81.04 |   |
| Vested                               |   |                       | (157,056 | )      |                                               |   | 56.10 |   |
| Non-vested      at December 31, 2007 |   |                       | 681,094  |   |                                               |   | 85.43 |   |
| Granted                              |   |                       | 347,175  |   |                                               |   | 66.62 |   |
| Forfeited                            |   |                       | (53,592  | )      |                                               |   | 82.20 |   |
| Vested                               |   |                       | (50,263  | )      |                                               |   | 56.16 |   |
| Non-vested      at December 31, 2008 |   |                       | 924,414  |   |                                               | $      | 80.15 |   |

----

|                                                                                                                            | Reportable      Business Segments       |    |                                |   |                                       |   |   |
|---------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------|---------|-------------------------------------|--------|--------------------------------------------|--------|--------|
| Year      Ended December 31, 2008                                                                                               | Power      Tools      & Accessories |    | Hardware&      Home Improvement |   | Fastening &      Assembly Systems |   | Total  |   | Currency      Translation Adjustments |   | Corporate,      Adjustment,      &      Eliminations |   | Consolidated |
|                                                                                                                            |                                    |    |                                |   |                                       |   |   |   |   |   |   |   |   |
| Sales to      unaffiliated customers                                                                                            | $                                       | 4,371.6 |                                | $      | 896.6                                      |   | $      | 700.4 |   | $ | 5,968.6 |   | $ | 117.5 |   | $ | — |   | $ | 6,086.1 |
| Segment      profit      (loss)(for Consolidated,      operatingincome      before      restructuring and      exit      costs) |                                    | 321.3   |                                |   | 76.9                                       |   |   | 103.3 |   |   | 501.5 |   |   | 32.7 |   |   | (57.4 | ) |   | 476.8 |
| Depreciation      and amortization                                                                                              |                                    | 90.5    |                                |   | 20.6                                       |   |   | 21.6 |   |   | 132.7 |   |   | 2.8 |   |   | 1.1 |   |   | 136.6 |
| Income      from equity method investees                                                                                        |                                    | 12.0    |                                |   | —                                    |   |   | — |   |   | 12.0 |   |   | — |   |   | (.9 | ) |   | 11.1 |
| Capital      expenditures                                                                                                       |                                    | 57.3    |                                |   | 16.4                                       |   |   | 18.7 |   |   | 92.4 |   |   | 1.6 |   |   | 4.8 |   |   | 98.8 |
| Segment      assets (for      Consolidated, total      assets)                                                                  |                                    | 2,526.2 |                                |   | 573.5                                      |   |   | 433.4 |   |   | 3,533.1 |   |   | (60.0 | ) |   | 1,710.2 |   |   | 5,183.3 |
| Investment      in equity method investees                                                                                      |                                    | 26.8    |                                |   | —                                    |   |   | .5 |   |   | 27.3 |   |   | — |   |   | (1.7 | ) |   | 25.6 |
|                                                                                                                            |                                    |    |                                |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Year      Ended December 31, 2007                                                                                               |                                    |    |                                |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sales      to unaffiliated customers                                                                                            | $                                       | 4,843.7 |                                | $      | 1,006.7                                    |   | $      | 718.3 |   | $ | 6,568.7 |   | $ | (5.5 | ) | $ | — |   | $ | 6,563.2 |
| Segment      profit (loss) (for      Consolidated, operating income      before      restructuring and      exit      costs)    |                                    | 488.8   |                                |   | 114.9                                      |   |   | 111.5 |   |   | 715.2 |   |   | (2.5 | ) |   | (111.5 | ) |   | 601.2 |
| Depreciation      and amortization                                                                                              |                                    | 97.4    |                                |   | 22.8                                       |   |   | 20.6 |   |   | 140.8 |   |   | (.3 | ) |   | 2.9 |   |   | 143.4 |
| Income      from equity method investees                                                                                        |                                    | 12.7    |                                |   | —                                    |   |   | — |   |   | 12.7 |   |   | — |   |   | (1.0 | ) |   | 11.7 |
| Capital      expenditures                                                                                                       |                                    | 65.5    |                                |   | 20.8                                       |   |   | 21.8 |   |   | 108.1 |   |   | .4 |   |   | 7.9 |   |   | 116.4 |
| Segment      assets (for      Consolidated, total      assets)                                                                  |                                    | 2,687.9 |                                |   | 655.5                                      |   |   | 406.5 |   |   | 3,749.9 |   |   | 97.4 |   |   | 1,563.6 |   |   | 5,410.9 |
| Investment      in equity method investees                                                                                      |                                    | 15.6    |                                |   | —                                    |   |   | .5 |   |   | 16.1 |   |   | — |   |   | (1.7 | ) |   | 14.4 |
|                                                                                                                            |                                    |    |                                |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Year      Ended December 31, 2006                                                                                               |                                    |    |                                |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sales      to unaffiliated customers                                                                                            | $                                       | 4,907.3 |                                | $      | 1,014.5                                    |   | $      | 692.4 |   | $ | 6,614.2 |   | $ | (166.9 | ) | $ | — |   | $ | 6,447.3 |
| Segment      profit (loss) (for      Consolidated, operating income)                                                            |                                    | 591.3   |                                |   | 138.3                                      |   |   | 100.4 |   |   | 830.0 |   |   | (21.5 | ) |   | (68.1 | ) |   | 740.4 |
| Depreciation      and amortization                                                                                              |                                    | 114.3   |                                |   | 22.9                                       |   |   | 19.5 |   |   | 156.7 |   |   | (4.0 | ) |   | 2.2 |   |   | 154.9 |
| Income      from equity method investees                                                                                        |                                    | 13.2    |                                |   | —                                    |   |   | — |   |   | 13.2 |   |   | — |   |   | (1.1 | ) |   | 12.1 |
| Capital      expenditures                                                                                                       |                                    | 74.5    |                                |   | 14.0                                       |   |   | 17.3 |   |   | 105.8 |   |   | (2.6 | ) |   | 1.4 |   |   | 104.6 |
| Segment      assets (for      Consolidated, total      assets)                                                                  |                                    | 2,841.3 |                                |   | 642.0                                      |   |   | 390.4 |   |   | 3,873.7 |   |   | (58.7 | ) |   | 1,432.7 |   |   | 5,247.7 |
| Investment      in equity method investees                                                                                      |                                    | 10.9    |                                |   | —                                    |   |   | .3 |   |   | 11.2 |   |   | — |   |   | (1.7 | ) |   | 9.5 |

----

|                                                                                                                                                                                             |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Segment      profit for total reportable      business segments                                                                                                                                  |   | $      | 501.5  |   |   | $      | 715.2  |   |   | $ | 830.0 |   |
| Items      excluded from segment profit:                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Adjustment      of budgeted foreign exchange      rates to actual rates                                                                                                                          |   |   | 32.7   |   |   |   | (2.5   | )      |   |   | (21.5 | ) |
| Depreciation      of Corporate property                                                                                                                                                          |   |   | (1.1   | )      |   |   | (1.4   | )      |   |   | (.9 | ) |
| Adjustment      to businesses’ postretirement benefit      expenses booked in consolidation                                                                                                |   |   | (3.6   | )      |   |   | (19.9  | )      |   |   | (25.2 | ) |
| Other      adjustments booked in consolidation directly      related to reportable business segments                                                                                             |   |   | (4.9   | )      |   |   | 8.3    |   |   |   | (.2 | ) |
| Amounts      allocated to businesses in arriving at segment      profit in excess of (less than) Corporate center      operating expenses, eliminations, and other amounts      identified above |   |   | (47.8  | )      |   |   | (98.5  | )      |   |   | (41.8 | ) |
| Operating      income before restructuring and exit costs                                                                                                                                        |   |   | 476.8  |   |   |   | 601.2  |   |   |   | 740.4 |   |
| Restructuring      and exit costs                                                                                                                                                                |   |   | 54.7   |   |   |   | 19.0   |   |   |   | — |   |
| Operating      income                                                                                                                                                                            |   |   | 422.1  |   |   |   | 582.2  |   |   |   | 740.4 |   |
| Interest      expense, net of interest income                                                                                                                                                    |   |   | 62.4   |   |   |   | 82.3   |   |   |   | 73.8 |   |
| Other      (income) expense                                                                                                                                                                      |   |   | (5.0   | )      |   |   | 2.3    |   |   |   | 2.2 |   |
| Earnings      before income taxes                                                                                                                                                                |   | $      | 364.7  |   |   | $      | 497.6  |   |   | $ | 664.4 |   |

|                                                                      |   | 2008   |    |   | 2007   |   |    | 2006   |   |
|---------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| Segment      assets for total      reportable      business      segments |   | $      | 3,533.1 |   |   | $      | 3,749.9 |   |   | $ | 3,873.7 |   |
| Items      excluded from segment assets:                                  |   |   |    |   |   |   |    |   |   |   |   |   |
| Adjustment      of budgeted foreign exchange      rates to actual rates   |   |   | (60.0   | )      |   |   | 97.4    |   |   |   | (58.7 | ) |
| Goodwill                                                                  |   |   | 629.6   |   |   |   | 636.2   |   |   |   | 624.0 |   |
| Pension      assets                                                       |   |   | 17.5    |   |   |   | 76.6    |   |   |   | 31.6 |   |
| Other      Corporate assets                                               |   |   | 1,063.1 |   |   |   | 850.8   |   |   |   | 777.1 |   |
|                                                                      |   | $      | 5,183.3 |   |   | $      | 5,410.9 |   |   | $ | 5,247.7 |   |

----

|                                                                   |   | 2008   |    |   | 2007   |   |    | 2006   |   |
|------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| Consumer      and industrial power      tools      and product service |   | $      | 3,236.1 |   |   | $      | 3,537.3 |   |   | $ | 3,481.1 |   |
| Lawn      and garden products                                          |   |   | 377.9   |   |   |   | 430.6   |   |   |   | 457.8 |   |
| Consumer      and industrial accessories                               |   |   | 452.0   |   |   |   | 479.2   |   |   |   | 475.1 |   |
| Cleaning,      automotive, lighting, and household      products       |   |   | 321.0   |   |   |   | 345.3   |   |   |   | 319.3 |   |
| Security      hardware                                                 |   |   | 649.9   |   |   |   | 730.9   |   |   |   | 751.7 |   |
| Plumbing      products                                                 |   |   | 309.2   |   |   |   | 323.3   |   |   |   | 296.0 |   |
| Fastening      and assembly systems                                    |   |   | 740.0   |   |   |   | 716.6   |   |   |   | 666.3 |   |
|                                                                   |   | $      | 6,086.1 |   |   | $      | 6,563.2 |   |   | $ | 6,447.3 |   |

|               |   | 2008   |    |   | 2007   |   |    | 2006   |   |
|--------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| United      States |   | $      | 3,358.6 |   |   | $      | 3,930.2 |   |   | $ | 4,149.9 |   |
| Canada             |   |   | 382.3   |   |   |   | 361.8   |   |   |   | 356.5 |   |
| North      America |   |   | 3,740.9 |   |   |   | 4,292.0 |   |   |   | 4,506.4 |   |
| Europe             |   |   | 1,516.0 |   |   |   | 1,568.0 |   |   |   | 1,357.1 |   |
| Other              |   |   | 829.2   |   |   |   | 703.2   |   |   |   | 583.8 |   |
|               |   | $      | 6,086.1 |   |   | $      | 6,563.2 |   |   | $ | 6,447.3 |   |

|                 |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|----------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| United      States   |   | $      | 217.7  |   |   | $      | 259.6  |   |   | $ | 281.9 |   |
| Mexico               |   |   | 98.3   |   |   |   | 106.8  |   |   |   | 120.9 |   |
| Other      countries |   |   | 211.9  |   |   |   | 229.8  |   |   |   | 219.4 |   |
|                 |   | $      | 527.9  |   |   | $      | 596.2  |   |   | $ | 622.2 |   |

|       |   |   |   |
|------------|--------|--------|--------|
| 2009       |   | $      | 69.8   |   |
| 2010       |   |   | 50.5   |   |
| 2011       |   |   | 30.0   |   |
| 2012       |   |   | 17.9   |   |
| 2013       |   |   | 7.3    |   |
| Thereafter |   |   | 16.8   |   |
|       |   | $      | 192.3  |   |

----

|                                            |   | SEVERANCE      BENEFITS |    |   | WRITE-DOWNTO      FAIR VALUELESS      COSTSTO      SELLOF      CERTAINLONG-LIVED      ASSETS |   |    | OTHER      CHARGES |   |   | TOTAL   |   |
|-------------------------------------------------|--------|-------------------------|---------|--------|----------------------------------------------------------------------------------------------|--------|---------|--------------------|--------|--------|---------|--------|
| Restructuring      reserve at December 31, 2005 |   | $                       | 5.3     |   |                                                                                         | $      | — |               |   | $      | 1.2     |   |   | $ | 6.5 |   |
| Reserves      established in 2006               |   |                    | — |   |                                                                                         |   | 1.8     |               |   |   | — |   |   |   | 1.8 |   |
| Reversal      of reserves                       |   |                    | (1.8    | )      |                                                                                         |   | — |               |   |   | — |   |   |   | (1.8 | ) |
| Utilization      of reserves:                   |   |                    |    |   |                                                                                         |   |    |               |   |   |    |   |   |   |   |   |
| Cash                                            |   |                    | (.9     | )      |                                                                                         |   | — |               |   |   | (.8     | )      |   |   | (1.7 | ) |
| Non-cash                                        |   |                    | — |   |                                                                                         |   | (1.8    | )                  |   |   | — |   |   |   | (1.8 | ) |
| Foreign      currency translation               |   |                    | .2      |   |                                                                                         |   | — |               |   |   | — |   |   |   | .2 |   |
| Restructuring      reserve at December 31, 2006 |   |                    | 2.8     |   |                                                                                         |   | — |               |   |   | .4      |   |   |   | 3.2 |   |
| Reserves      established in 2007               |   |                    | 14.8    |   |                                                                                         |   | 4.0     |               |   |   | .2      |   |   |   | 19.0 |   |
| Utilization      of reserves:                   |   |                    |    |   |                                                                                         |   |    |               |   |   |    |   |   |   |   |   |
| Cash                                            |   |                    | (1.0    | )      |                                                                                         |   | — |               |   |   | — |   |   |   | (1.0 | ) |
| Non-cash                                        |   |                    | — |   |                                                                                         |   | (4.0    | )                  |   |   | — |   |   |   | (4.0 | ) |
| Foreign      currency translation               |   |                    | .1      |   |                                                                                         |   | — |               |   |   | — |   |   |   | .1 |   |
| Restructuring      reserve at December 31, 2007 |   |                    | 16.7    |   |                                                                                         |   | — |               |   |   | .6      |   |   |   | 17.3 |   |
| Reserves      established in 2008               |   |                    | 48.3    |   |                                                                                         |   | 3.7     |               |   |   | 2.7     |   |   |   | 54.7 |   |
| Utilization      of reserves:                   |   |                    |    |   |                                                                                         |   |    |               |   |   |    |   |   |   |   |   |
| Cash                                            |   |                    | (24.9   | )      |                                                                                         |   | — |               |   |   | (.4     | )      |   |   | (25.3 | ) |
| Non-cash                                        |   |                    | — |   |                                                                                         |   | (3.7    | )                  |   |   | (.9     | )      |   |   | (4.6 | ) |
| Foreign      currency translation               |   |                    | (4.5    | )      |                                                                                         |   | — |               |   |   | — |   |   |   | (4.5 | ) |
| Restructuring      reserve at December 31, 2008 |   | $                       | 35.6    |   |                                                                                         | $      | — |               |   | $      | 2.0     |   |   | $ | 37.6 |   |

----

----

----

| (DOLLARS      IN MILLIONS EXCEPT PER SHARE DATA)YEAR      ENDED DECEMBER 31, 2008 |   | FIRST      QUARTER |    |   | SECOND      QUARTER |   |    | THIRD      QUARTER |   |   | FOURTH      QUARTER |   |
|-----------------------------------------------------------------------------------|--------|--------------------|---------|--------|---------------------|--------|---------|--------------------|--------|--------|---------------------|--------|
| Sales                                                                             |   | $                  | 1,495.8 |   |                | $      | 1,641.7 |               |   | $      | 1,570.8             |   |   | $ | 1,377.8 |   |
| Gross      margin                                                                 |   |               | 517.5   |   |                |   | 537.2   |               |   |   | 508.9               |   |   |   | 434.8 |   |
| Net      earnings                                                                 |   |               | 67.4    |   |                |   | 96.7    |               |   |   | 85.8                |   |   |   | 43.7 |   |
| Net      earnings per common share–basic                                    |   | $                  | 1.11    |   |                | $      | 1.61    |               |   | $      | 1.45                |   |   | $ | .74 |   |
| Net      earnings per common share–diluted                                  |   | $                  | 1.09    |   |                | $      | 1.58    |               |   | $      | 1.42                |   |   | $ | .73 |   |

| YEAR      ENDED DECEMBER 31, 2007                |   | FIRST      QUARTER |    |   | SECOND      QUARTER |   |    | THIRD      QUARTER |   |   | FOURTH      QUARTER |   |
|--------------------------------------------------|--------|--------------------|---------|--------|---------------------|--------|---------|--------------------|--------|--------|---------------------|--------|
| Sales                                            |   | $                  | 1,577.2 |   |                | $      | 1,699.9 |               |   | $      | 1,633.6             |   |   | $ | 1,652.5 |   |
| Gross      margin                                |   |               | 560.6   |   |                |   | 587.9   |               |   |   | 555.9               |   |   |   | 522.6 |   |
| Net      earnings                                |   |               | 108.1   |   |                |   | 118.0   |               |   |   | 104.6               |   |   |   | 187.4 |   |
| Net      earnings per common share–basic   |   | $                  | 1.66    |   |                | $      | 1.80    |               |   | $      | 1.63                |   |   | $ | 3.02 |   |
| Net      earnings per common share–diluted |   | $                  | 1.61    |   |                | $      | 1.75    |               |   | $      | 1.59                |   |   | $ | 2.94 |   |

----

----

----

----

----

| (a)  | List      of Financial Statements, Financial Statement Schedules, and      Exhibits |
|-----------|-------------------------------------------------------------------------------------|

----

----

| (b)  | Exhibits |
|-----------|----------|

----

| (c)  | Financial      Statement Schedules and Other Financial  Statements |
|-----------|--------------------------------------------------------------------|

| DESCRIPTION                                           |   | BALANCE      AT BEGINNING OF PERIOD |   |   | ADDITIONS      CHARGED      TO COSTS      AND EXPENSES |   |   | DEDUCTIONS |   |   | OTHER      CHANGES ADD      (DEDUCT) |   |   | BALANCEAT      ENDOF      PERIOD |   |
|-------------------------------------------------------|--------|-------------------------------------|--------|--------|--------------------------------------------------------|--------|--------|------------|--------|--------|--------------------------------------|--------|--------|----------------------------------|--------|
| Year      Ended December 31, 2008                     |   |                                |   |   |                                                   |   |   |       |   |   |                                 |   |   |                             |   |
| Reserve      for doubtful accounts and cash discounts |   | $                                   | 44.2   |   |                                                   | $      | 89.2   |       |   | $      | 91.8                                 | (a)    |   | $                                | (2.5   | )(b) |   | $ | 39.1 |   |
| Year      Ended December 31, 2007                     |   |                                |   |   |                                                   |   |   |       |   |   |                                 |   |   |                             |   |   |   |   |   |   |
| Reserve      for doubtful accounts and cash discounts |   | $                                   | 44.5   |   |                                                   | $      | 91.8   |       |   | $      | 94.5                                 | (a)    |   | $                                | 2.4    | (b) |   | $ | 44.2 |   |
| Year      Ended December 31, 2006                     |   |                                |   |   |                                                   |   |   |       |   |   |                                 |   |   |                             |   |   |   |   |   |   |
| Reserve      for doubtful accounts and cash discounts |   | $                                   | 45.1   |   |                                                   | $      | 101.5  |       |   | $      | 104.1                                | (a)    |   | $                                | 2.0    | (b) |   | $ | 44.5 |   |

| (a)  | Accounts      written off during the year and cash discounts taken by      customers. |
|-----------|---------------------------------------------------------------------------------------|

| (b)  | Primarily      includes currency translation adjustments and amounts associated with      acquired and divestedbusinesses. |
|-----------|----------------------------------------------------------------------------------------------------------------------------|

----

|   |              |   | THE      BLACK & DECKER CORPORATION |                                                                  |
|--------|-------------------|--------|-----------------------------------------|-----------------------------------------------------------------------|
|   |              |   |                                    |                                                                  |   |   |
| Date:  | February 16, 2009 |   | By                                      | /s/ NOLAN D. ARCHIBALD                                                |   |   |
|   |              |   |                                    |  Nolan      D. Archibald                                         |   |   |
|   |              |   |                                    |  Chairman,      President, and Chief      Executive Officer |   |   |
|   |              |   |                                    |                                                                  |   |   |

| SIGNATURE                        |   | TITLE                                                 |        DATE                   |   |
|----------------------------------|--------|-------------------------------------------------------|------------------------------------|--------|
|                             |   |                                                  |                               |   |
| Principal      Executive Officer |   |                                                  |                               |   |
| /s/      NOLAN D. ARCHIBALD      |   |                                                  |        February      16, 2009 |   |
| Nolan      D. Archibald          |   | Chairman,      President, and Chief Executive Officer |                               |   |
|                             |   |                                                  |                               |   |

| Principal      Financial Officer |   |                                                   |                               |   |
|----------------------------------|--------|--------------------------------------------------------|------------------------------------|--------|
| /s/      STEPHEN F. REEVES       |   |                                                   |        February      16, 2009 |   |
| Stephen      F. Reeves           |   | Senior      Vice President and Chief Financial Officer |                               |   |
|                             |   |                                                   |                               |   |

| Principal      Accounting Officer |   |                               |                               |   |
|-----------------------------------|--------|------------------------------------|------------------------------------|--------|
| /s/      CHRISTINA M. MCMULLEN    |   |                               |        February      16, 2009 |   |
| Christina      M. McMullen        |   | Vice      President and Controller |                               |   |
|                              |   |                               |                               |   |
|                              |   |                               |                               |   |

|   | Nolan      D. Archibald  |   | Manual      A. Fernandez      |   |
|--------|--------------------------|--------|-------------------------------|--------|
|   | Norman      R. Augustine |   | Benjamin      H. Griswold, IV |   |
|   | Barbara      L. Bowles   |   | Anthony      Luiso            |   |
|   | George      W. Buckley   |   | Robert      L. Ryan           |   |
|   | M.      Anthony Burns    |   | Mark      H. Willes           |   |
|   | Kim      B. Clark        |   |                          |   |

| By     | /s/      NOLAN D. ARCHIBALD |   | Date:  | February      16, 2009 |   |
|--------|-----------------------------|--------|--------|------------------------|--------|
|   | Nolan      D. Archibald     |   |   |                   |   |
|   | Attorney-in-Fact            |   |   |                   |   |

----