-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HRQq4tYm+wlJQ0/KzmbfBwwrBMIXFKwTC2X30qXXQOAnOuVx+DErVGafdfnE/hMo zjsWBAMH40yom7r8j41D8A== /in/edgar/work/20000628/0000950152-00-004958/0000950152-00-004958.txt : 20000920 0000950152-00-004958.hdr.sgml : 20000920 ACCESSION NUMBER: 0000950152-00-004958 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EATON CORP CENTRAL INDEX KEY: 0000031277 STANDARD INDUSTRIAL CLASSIFICATION: [3600 ] IRS NUMBER: 340196300 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-01396 FILM NUMBER: 662172 BUSINESS ADDRESS: STREET 1: EATON CTR STREET 2: 1111 SUPERIOR AVE CITY: CLEVELAND STATE: OH ZIP: 44114-2584 BUSINESS PHONE: 2165235000 MAIL ADDRESS: STREET 1: 1111 SUPERIOR AVENUE CITY: CLEVELAND STATE: OH ZIP: 44114 FORMER COMPANY: FORMER CONFORMED NAME: EATON YALE & TOWNE INC DATE OF NAME CHANGE: 19710822 11-K 1 e11-k.txt EATON CORPORATION 11-K 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One) [X] Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934 (Fee required) For the fiscal year ended December 31, 1999 Or [ ] Transition report pursuant to Section 15(d) of the Securities Exchange Act of 1934 (Fee required) For the transition period from _____________ to ___________ Commission file number ____________________________________ A. Full title of the plan and the address of the plan, if different from that of the issuer named below: EATON CORPORATION 401(k) SAVINGS PLAN FOR THE HOURLY RATE EMPLOYEES AT AIRFLEX DIVISION B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Eaton Corporation, 1111 Superior Avenue, Cleveland, Ohio 44114-2584 SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. (Name of Plan) EATON CORPORATION 401(k) SAVINGS PLAN FOR THE HOURLY RATE EMPLOYEES AT AIRFLEX DIVISION Date: June 27, 2000 By: Eaton Corporation Pension Administration Committee By: /s/ S. J. Cook ------------------------------- (Signature) S. J. Cook Vice President-Human Resources Eaton Corporation 2 AUDITED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division December 31, 1999 and 1998 and Year Ended December 31, 1999 3 Report of Independent Auditors Corporate Compensation and Organization Committee of Eaton Corporation Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division We have audited the accompanying statements of net assets available for benefits of the Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division as of December 31, 1999 and 1998, and the related statement of changes in net assets available for benefits for the year ended December 31, 1999. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 1999 and 1998, and the changes in its net assets available for benefits for the year ended December 31, 1999, in conformity with accounting principles generally accepted in the United States. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets held for investment purposes at end of year as of December 31, 1999, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole. CLEVELAND, OHIO /s/ ERNST & YOUNG LLP June 9, 2000 1 4 Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division Statements of Net Assets Available for Benefits
DECEMBER 31 1999 1998 ------------------------------------ ASSETS Investments: Mutual funds $ 234,259 $ 171,059 Common/collective trust fund 98,465 98,010 Eaton Corporation Common Shares 139,004 124,906 Participant loans receivable 20,592 19,642 ------------------------------------ Total investments 492,320 413,617 Receivables: Interest 13 6 Employee contributions 3,253 4,968 ------------------------------------ Total receivables 3,266 4,974 ------------------------------------ Total assets 495,586 418,591 LIABILITIES Accrued purchase of investments - 565 ------------------------------------ NET ASSETS AVAILABLE FOR BENEFITS $ 495,586 $ 418,026 ====================================
See notes to financial statements 2 5 Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division Statement of Changes in Net Assets Available for Benefits Year Ended December 31, 1999
ADDITIONS Investment income: Interest and dividends $ 21,017 Net appreciation in fair value of investments 27,977 ------------------- 48,994 Employee contributions 70,115 ------------------- Total additions 119,109 DEDUCTIONS Distributions to participants 41,549 ------------------- Net increase 77,560 Net assets available for benefits: Beginning of year 418,026 ------------------- END OF YEAR $ 495,586 ===================
See notes to financial statements. 3 6 Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division Notes to Financial Statements December 31, 1999 and 1998 and Year Ended December 31, 1999 A. SIGNIFICANT ACCOUNTING POLICIES The financial statements of the Plan are prepared on the accrual basis of accounting. Investments are stated at fair value as measured by quoted prices in active markets except for common/collective trust funds, which are stated at fair value as determined by the trustee. The participant loans receivable are valued at their outstanding balances, which approximate fair value. The cost of shares sold for mutual funds and Eaton Common Shares is based upon the average cost of each participant's shares sold for purposes of determining realized gains and losses. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. Certain prior years amounts have been reclassified to conform to the current year presentation. B. DESCRIPTION OF THE PLAN Effective January 1, 1995, Eaton Corporation (the "Company" or "Plan Sponsor") established a 401(k) profit sharing plan and trust to be known as the Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division (the "Plan"). The Plan provides that all union employees of the Airflex Division who are members of UPIU local 7967 will be eligible for membership in the Plan on the date at which the employee has completed ninety working days of service with the Company. Eligible employees may elect to make before-tax contributions from 1 to 15 percent of their compensation. Contributions are allocated by the employee among the investment funds offered by the Plan. 4 7 Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division Notes to Financial Statements--Continued B. DESCRIPTION OF THE PLAN--CONTINUED Each participant's account is credited with the participant's contribution and an allocation of the Plan's earnings and administrative expenses. Allocations are based on participant account balances. The benefit to which a participant is entitled is the benefit that can be provided from the participant's account. Participants are immediately vested in their contributions plus actual earnings thereon. On termination of service, a participant is eligible to receive a lump-sum amount equal to the value of his account. Participants may borrow from their fund accounts up to the lesser of $50,000 or 50% of their vested account balance, reduced by their highest outstanding loan balance during the preceding 12 months. Loan terms range from 1-5 years except for loans used for the purchase of a primary residence. The loans are secured by the balance in the participant's account and bear interest at a rate based on the prime interest rates as determined daily by the Trustee. Principal and interest are paid ratably through monthly payroll deductions. All administrative and transaction costs, management fees and expenses of the Plan shall be paid by the trustee from the trust unless such costs, fees and expenses are paid by the Company. The Company may amend, modify, suspend or terminate the Plan at any time, subject to the provisions of ERISA. No amendment, modification, suspension or termination of the Plan shall have the effect of providing that any amounts then held under the Plan may be used or diverted to any purpose other than for the exclusive benefit of members or their beneficiaries. Information about the Plan is contained in the Plan Document, which is available from the Human Resources Department upon request. 5 8 Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division Notes to Financial Statements--Continued C. INVESTMENT ASSETS Key Trust Company of Ohio, N.A., trustee of the plan, holds the Plan's investment assets and executes investment transactions. During 1999, the Plan's investments (including investments purchased, sold as well as held during the year) appreciated in fair value as determined by quoted market prices as follows:
Net Realized and Unrealized Appreciation in Fair Value of Investments -------------------- Common/collective trust funds $ 5,011 Common stock 8,324 Mutual funds 14,642 -------------------- $ 27,977 ====================
The fair value of individual investments that represent 5% or more of the Plan's net assets available for benefits are as follows:
DECEMBER 31 1999 1998 ---------------------------------- Prism Money Market Fund $ 58,793 $ 64,134 Prism Magic Fund 39,186 33,876 Victory Balanced Fund 72,999 53,945 Victory Stock Index Fund 100,697 72,294 Victory Special Value Fund 28,087 21,818 Victory International Growth Fund 32,476 23,002 Eaton Corporation Common Shares 139,004 124,906
6 9 Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division Notes to Financial Statements--Continued D. INCOME TAX STATUS The Plan has not received a determination letter from the Internal Revenue Service stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the "Code"). However, the Plan Administrator believes that the Plan is qualified and, therefore, the related trust is exempt from taxation. E. TRANSACTIONS WITH PARTIES-IN-INTEREST Party-in-interest transactions include the investment in the funds of the trustee and the payment of administrative expenses by the Company. Such transactions are exempt from being prohibited transactions. 7 10 Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division EIN 34-0196300 Plan Number 159 Schedule H, Line 4(i)--Schedule of Assets Held for Investment Purposes at End of Year December 31, 1999
Description of Current Identity of Issue Investment Value ----------------------------------------------------------------------------------------------------- * Key Bank: EB Money Market Fund 486 units $ 486 Prism Money Market Fund 4,679 units 58,793 Prism Magic Fund 2,881 units 39,186 Victory Balanced Fund 5,166 shares 72,999 Victory Stock Index Fund 4,122 shares 100,697 Victory Special Value Fund 2,152 shares 28,087 Victory International Growth Fund 1,799 shares 32,476 * Eaton Corporation Common Shares 1,914 shares 139,004 * Participant Loans Receivable 8.75-9.50% variable maturities 20,592 ----------------- $ 492,320 =================
* Indicates a party-in-interest to the Plan. 8 EX-23 2 ex23.txt EXHIBIT 23 1 Exhibit 23 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-13861) pertaining to the Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division of our report dated June 9, 2000, with respect to the financial statements and schedule of the Eaton Corporation 401(k) Savings Plan for the Hourly Rate Employees at Airflex Division included in this Annual Report (Form 11-K) for the year ended December 31, 1999. /s/ Ernst & Young LLP Cleveland, Ohio June 26, 2000 -----END PRIVACY-ENHANCED MESSAGE-----