Eaton provides spin-off tax basis allocation information to shareholders


CLEVELAND, OHIO… Eaton Corporation (NYSE:ETN) today said that as a result of its spinoff of Axcelis Technologies, Inc. (NASDAQ:ACLS), a shareholder's original tax basis in Eaton shares will now be allocated 86.77 percent to Eaton shares, and 13.23 percent to Axcelis shares. Eaton distributed its shares of Axcelis to Eaton shareholders after the market closed on December 29, 2000.

Eaton shareholders are required to allocate the cost basis of their Eaton shares between those shares and the Axcelis shares, in proportion to their market values immediately after the spin-off. The opening stock price of Eaton on the NYSE on January 2, 2001, was $65.25. Axcelis opened on the NASDAQ on that date at $8.4375.

Eaton said that shareholders should consult their tax advisors regarding the applicability of this calculation to their particular circumstances.

The company also said that it will soon provide to shareholders more detailed U.S. tax information for the Axcelis spin-off, including a statement that is required to be attached to the U.S. federal income tax return of each Eaton shareholder who received Axcelis shares in the spin-off. Shareholders will also be able to obtain copies of these documents on Eaton's website 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 59,000 employees and 195 manufacturing sites in 24 countries.


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Renald Romain

William Hartman, vice president, Investor Relations