Eaton Corporation completes spin-off of Axcelis Technologies, Inc.


CLEVELAND, OHIO… Eaton Corporation (NYSE:ETN) today announced that, at the close of market today, it completed the spin-off of Axcelis Technologies, Inc. (NASDAQ:ACLS) by distributing 1.179023 shares of Axcelis common stock as a dividend on each Eaton Corporation common share outstanding on the record date of December 6, 2000.

This distribution of Axcelis common stock is the final step in the separation of Axcelis from Eaton. In April, 2000, Eaton announced its plan to reorganize its semiconductor equipment operations into a wholly owned subsidiary, and to have that subsidiary conduct an initial public offering of less than 20 percent of its common stock. The initial public offering was completed in July. In October, Eaton's board of directors declared the dividend of Axcelis common stock that is being paid today. Eaton no longer owns any Axcelis shares, and Axcelis is a fully independent, publicly-traded company.

In addition to receiving whole shares of Axcelis, Eaton shareholders will receive cash payments for fractional shares. Eaton’s transfer agent, EquiServe Trust Company, N.A. will aggregate and sell all fractional shares, and shareholders will receive a cash payment equal to their prorata share of the net proceeds for that sale. Any such cash payment will be paid soon after the distribution of whole Axcelis shares.

Eaton had previously announced that it had received a ruling from the Internal Revenue Service that this stock distribution to shareholders qualifies as tax-free for U.S. federal income tax purposes. Cash received in lieu of fractional shares will be taxable.

Further information concerning the spin-off, including the method used to calculate the number of Axcelis shares that each Eaton shareholder is entitled to receive, is set forth in a previously distributed Information Statement, dated December 8, 2000. Shareholders may obtain a copy of that Information Statement at Stockholders who have questions about the Axcelis spin-off also may call Eaton’s Information Agent, Georgeson Shareholder Communications, Inc., toll free, at 1-866-654-3395. Information about Axcelis is available at

With 1999 sales of $8.4 billion, Eaton is a global diversified industrial manufacturer of highly engineered products that serve industrial, vehicle, construction, commercial and aerospace markets. Principal products include hydraulic products and fluid connectors, electrical power distribution and control equipment, truck drivetrain systems, engine components and a wide variety of controls. The company has 64,000 employees and 200 manufacturing sites in 24 countries.

Axcelis is headquartered in Beverly, Mass., and is a leading producer of ion implantation equipment used in the fabrication of semiconductors. Axcelis also produces dry strip, photostabilization and rapid thermal processing equipment used in semiconductor manufacturing, and provides extensive aftermarket service and support, including spare parts, equipment upgrades, maintenance services and customer training.



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Renald Romain