Hmmm, maybe this will make sense? (adding the braces you missed (typo :)

my $tool_number = 1; # (say - perhaps you're looping through them, hen
+ce...
$tool_number = sprintf(%02d,$tool_number); # add leading zero, if need
+ed


while (<PD_FILE>){
  if (/^Tool$tool_number/) {
    $continue = 1;
  }
  if (/^Tool/ && !(/^Tool$tool_number/)) {
    $continue = 0;
  }
  if ($continue){
    print $_;
  }
}
[download]

FYI - ^ matches the beginning of a string (line in this case).

cLive ;-)