Ohio
|
34-0196300 | |
|
||
(State or other jurisdiction of
|
(IRS Employer Identification Number) | |
incorporation or organization)
|
||
|
||
Eaton Center
|
||
Cleveland, Ohio
|
44114-2584 | |
|
||
(Address of principal executive offices)
|
(Zip code) |
Name of each exchange on | ||
Title of each class | which registered | |
Common Share ($.50 par value)
|
The New York Stock Exchange | |
|
The Chicago Stock Exchange |
Large accelerated filer
þ
|
Accelerated filer ¨ | Non-accelerated filer ¨ | Smaller reporting company ¨ | |||
|
(Do not check if a smaller reporting company) |
Business | Annual sales | |||||||
Acquired business | Date of transaction | segment | (in millions) | |||||
Chloride Phoenixtec Electronics
|
October 12, | Electrical | $25 for the | |||||
A China-based manufacturer of uninterruptible power supply (UPS) systems.
Eaton acquired the
remaining shares to
increase its ownership
from 50% to 100%.
|
2010 | Rest of World |
year ended
September 30, 2010 |
|||||
|
||||||||
CopperLogic, Inc.
|
October 1, | Electrical | $35 for the | |||||
A United States-based
manufacturer of electrical
and electromechanical
systems.
|
2010 | Americas |
year ended
September 30, 2010 |
|||||
|
||||||||
Wright Line Holding, Inc.
|
August 25, | Electrical | $101 for the | |||||
A United States provider
of customized enclosures,
rack systems, and air-flow
management systems to
store, power, and secure
mission-critical IT data
center electronics.
|
2010 | Americas |
year ended
June 30, 2010 |
|||||
|
||||||||
EMC Engineers, Inc.
|
July 15, 2010 | Electrical | $24 for 2009 | |||||
A United States energy
engineering and energy
services company that
delivers energy efficiency
solutions for a wide range
of governmental,
educational, commercial
and industrial facilities.
|
Americas |
Page 2
Page 3
Page 4
Page 5
Page 6
Name | Age | Position (Date elected to position) | ||||
Alexander M. Cutler
|
59 |
Chairman and Chief Executive Officer; President (August 1, 2000 present)
Director (September 22, 1993 present) |
Page 7
Name | Age | Position (Date elected to position) | ||||
Richard H. Fearon
|
54 | Vice Chairman and Chief Financial and Planning Officer (April 24, 2002 present) | ||||
|
||||||
Craig Arnold
|
50 |
Vice Chairman and Chief Operating Officer Industrial Sector (February 1, 2009 present)
Chief Executive Officer Fluid Power Group (October 25, 2000 January 31, 2009) |
||||
|
||||||
Thomas S. Gross
|
56 |
Vice Chairman and Chief Operating Officer Electrical Sector (February 1, 2009
present)
President Power Quality and Control Business (April 1, 2008 January 31, 2009) Vice President and President Power Quality Solutions Operations (May 16, 2005 March 31, 2008) |
||||
|
||||||
James W. McGill
|
55 |
Executive Vice President Chief Human Resources Officer (January 1, 2010
present)
President Asia-Pacific Region (April 1, 2008 December 31, 2009) Vice President Asia-Pacific (April 1, 2006 March 31, 2008) Vice President Eaton Business System (July 29, 2004 March 31, 2006) |
||||
|
||||||
Mark M. McGuire
|
53 | Executive Vice President and General Counsel (December 1, 2005 present) | ||||
|
||||||
Thomas E. Moran
|
46 |
Senior Vice President and Secretary (October 1, 2008 present)
Assistant Secretary and Managing Counsel, The Dow Chemical Company (2002 2008) |
||||
|
||||||
Billie K. Rawot
|
59 |
Senior Vice President and Controller (March 1, 1991 present)
|
||||
|
||||||
Kurt B. McMaken
|
41 |
Senior Vice President Corporate Development and Treasury (February 1, 2009 present)
Vice President Corporate Development and Planning (January 1, 2008 January 31, 2009) Director Corporate Planning (April 1, 2006 December 31, 2007) Director Corporate Development (October 1, 2004 March 31, 2006) |
Page 8
3 (i) | Amended Articles of Incorporation (amended and restated as of April 24, 2008) Incorporated by reference to the Form 10-Q Report for the three months ended March 31, 2008 | ||
3 (ii) | Amended Regulations (amended and restated as of February 24, 2010) Incorporated by reference to the Form 8-K Report dated February 24, 2010 | ||
4 (a) | Pursuant to Regulation S-K Item 601(b) (4), the Company agrees to furnish to the SEC, upon request, a copy of the instruments defining the rights of holders of its other long-term debt | ||
10 | Material contracts |
(a) | Senior Executive Incentive Compensation Plan (effective January 1, 2008) Incorporated by reference to the definitive Proxy Statement dated March 14, 2008 | ||
(b) | Executive Incentive Compensation Plan (effective January 1, 2005) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2005 | ||
(c) | 2005 Non-Employee Director Fee Deferral Plan (2008 restatement) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 |
Page 9
(d) | Deferred Incentive Compensation Plan II (2008 restatement) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(e) | Excess Benefits Plan II (2008 restatement) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(f) | Incentive Compensation Deferral Plan II (2008 restatement) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(g) | Limited Eaton Service Supplemental Retirement Income Plan II (2008 restatement) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(h) | Supplemental Benefits Plan II (2008 restatement) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(i) | Form of Restricted Share Unit Agreement (2 year vesting) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(j) | Form of Restricted Share Unit Agreement (4 year vesting) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(k) | Form of Restricted Share Agreement (2 year vesting) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(l) | Form of Restricted Share Agreement (4 year vesting) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(m) | Form of Restricted Share Agreement (Non-Employee Directors) Incorporated by reference to the Form 8-K Report filed February 1, 2010 | ||
(n) | Form of Stock Option Agreement for Executives (2008) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(o) | Form of Stock Option Agreement for Executives Incorporated by reference to the Form 10-K Report for the year ended December 31, 2006 | ||
(p) | Form of Stock Option Agreement for Non-Employee Directors (2008) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(q) | 2002 Stock Plan Incorporated by reference to the definitive Proxy Statement dated March 15, 2002 | ||
(r) | 2004 Stock Plan Incorporated by reference to the definitive Proxy Statement dated March 19, 2004 | ||
(s) | 2008 Stock Plan Incorporated by reference to the definitive Proxy Statement dated March 14, 2008 | ||
(t) | 2009 Stock Plan Incorporated by reference to the definitive Proxy Statement dated March 13, 2009 | ||
(u) | Plan for the Deferred Payment of Directors Fees (originally adopted in 1985 and amended effective September 24, 1996, January 28, 1998, January 23, 2002, February 24, 2004, December 8, 2004 and, in certain respects, January 1, 2005) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(v) | 1996 Non-Employee Director Fee Deferral Plan (amended and restated effective January 1, 2005) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2006 | ||
(w) | Form of Change of Control Agreement entered into with officers of Eaton Corporation Incorporated by reference to the Form 10-K Report for the year ended December 31, 2008 |
Page 10
(x) | Form of Indemnification Agreement entered into with officers of Eaton Corporation Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002 | ||
(y) | Form of Indemnification Agreement entered into with directors of Eaton Corporation Incorporated by reference to the Form 8-K Report filed January 26, 2007 | ||
(z) | Executive Strategic Incentive Plan (amended and restated January 1, 2008) Incorporated by reference to the definitive Proxy Statement dated March 14, 2008 | ||
(aa) | Executive Strategic Incentive Plan II (effective January 1, 2001) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002 | ||
(bb) | Supplemental Executive Strategic Incentive Plan (effective as of June 25, 2008) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2008 | ||
(cc) | Deferred Incentive Compensation Plan (amended and restated effective November 1, 2007) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2009 | ||
(dd) | 1998 Stock Plan Incorporated by reference to the definitive Proxy Statement dated March 13, 1998 | ||
(ee) | Incentive Compensation Deferral Plan (amended and restated October 1, 1997) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2000 | ||
(ff) | Trust Agreement Officers and Employees (dated December 6, 1996) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002 | ||
(gg) | Trust Agreement Non-employee Directors (dated December 6, 1996) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002 | ||
(hh) | Group Replacement Insurance Plan (GRIP) (effective June 1, 1992) Incorporated by reference to the Form 10-K Report for the year ended December 31, 1992 | ||
(ii) | 1991 Stock Option Plan Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002 | ||
(jj) | Excess Benefits Plan (amended and restated effective January 1, 1989) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002 | ||
(kk) | Supplemental Benefits Plan (amended and restated January 1, 1989) Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002 | ||
(ll) | Eaton Corporation Board of Directors Policy on Incentive Compensation, Stock Options and Other Equity Grants upon the Restatement of Financial Results Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007 | ||
(mm) | Amended and Restated Grantor Trust Agreement for Non-Employee Directors Deferred Fees Plans effective January 1, 2010 - Filed in conjunction with this Form 10-K report* | ||
(nn) | Amended and Restated Grantor Trust Agreement for Employees Deferred Compensation Plans effective January 1, 2010 - Filed in conjunction with this Form 10-K report* |
12 | Ratio of Earnings to Fixed Charges Filed in conjunction with this Form 10-K Report * | ||
14 | Code of Ethics Incorporated by reference to the definitive Proxy Statement filed on March 14, 2008 | ||
21 | Subsidiaries of Eaton Corporation Filed in conjunction with this Form 10-K Report * | ||
23 | Consent of Independent Registered Public Accounting Firm Filed in conjunction with this Form 10-K Report * | ||
24 | Power of Attorney Filed in conjunction with this Form 10-K Report * |
Page 11
* | Submitted electronically herewith. |
Attached as Exhibit 101 to this report are the following formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Income for the years ended December 31, 2010, 2009 and 2008, (ii) Consolidated Balance Sheets at December 31, 2010 and 2009, (iii) Consolidated Statements of Cash Flows for the years ended December 31, 2010, 2009 and 2008 (iv) Notes to Consolidated Financial Statements for the year ended December 31, 2010. | ||
In accordance with Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Annual Report on Form 10-K shall not be deemed to be filed for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be part of any registration statement or other document filed under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. | ||
(b) | Exhibits | |
Certain exhibits required by this portion of Item 15 are filed as a separate section of this Form 10-K Report. |
Page 12
Page 13
Eaton Corporation
Registrant
Date: February 25, 2011
/s/ Richard H. Fearon
Richard H. Fearon
Vice Chairman and Chief Financial and Planning Officer
Signature
Title
Chairman and Chief Executive Officer; President;
Principal Executive Officer; Director
Senior Vice President and Controller;
Principal Accounting Officer
*
Director
Christopher M. Connor
Director
*
Director
Charles E. Golden
Director
*
Director
Arthur E. Johnson
Director
*
Director
Deborah L. McCoy
Director
*
*
Director
Gary L. Tooker
Director
/s/ Richard H. Fearon
for the officers and directors signing
in the capacities indicated
Table of Contents
Page 14
Page 15
Eaton Corporation
Table of Contents
/s/ Richard H. Fearon
/s/ Billie K. Rawot
Vice Chairman and Chief Financial
Senior Vice President
and Planning Officer
and Controller
Table of Contents
Page 16
Page 17
Eaton Corporation
Table of Contents
/s/ Richard H. Fearon
/s/ Billie K. Rawot
Vice Chairman and Chief Financial
Senior Vice President
and Planning Officer
and Controller
February 25, 2011
Table of Contents
Year ended December 31 | ||||||||||||
(In millions except for per share data) | 2010 | 2009 | 2008 | |||||||||
Net sales
|
$ | 13,715 | $ | 11,873 | $ | 15,376 | ||||||
|
||||||||||||
Cost of products sold
|
9,633 | 8,782 | 11,191 | |||||||||
Selling and administrative expense
|
2,486 | 2,252 | 2,513 | |||||||||
Research and development expense
|
425 | 395 | 417 | |||||||||
Interest expense-net
|
136 | 150 | 157 | |||||||||
Other (income) expense-net
|
(1 | ) | (9 | ) | (42 | ) | ||||||
|
||||||||||||
Income from continuing operations before income taxes
|
1,036 | 303 | 1,140 | |||||||||
Income tax expense (benefit)
|
99 | (82 | ) | 73 | ||||||||
|
||||||||||||
Income from continuing operations
|
937 | 385 | 1,067 | |||||||||
Income from discontinued operations
|
| | 3 | |||||||||
|
||||||||||||
Net income
|
937 | 385 | 1,070 | |||||||||
Less net income for noncontrolling interests
|
(8 | ) | (2 | ) | (12 | ) | ||||||
|
||||||||||||
Net income attributable to Eaton common shareholders
|
$ | 929 | $ | 383 | $ | 1,058 | ||||||
|
||||||||||||
|
||||||||||||
Net income per common share diluted
|
||||||||||||
Continuing operations
|
$ | 2.73 | $ | 1.14 | $ | 3.25 | ||||||
Discontinued operations
|
| | 0.01 | |||||||||
|
||||||||||||
Total
|
$ | 2.73 | $ | 1.14 | $ | 3.26 | ||||||
|
||||||||||||
|
||||||||||||
Net income per common share basic
|
||||||||||||
Continuing operations
|
$ | 2.76 | $ | 1.16 | $ | 3.29 | ||||||
Discontinued operations
|
| | 0.01 | |||||||||
|
||||||||||||
Total
|
$ | 2.76 | $ | 1.16 | $ | 3.30 | ||||||
|
||||||||||||
|
||||||||||||
Weighted-average number of common shares outstanding
|
||||||||||||
Diluted
|
339.5 | 335.8 | 324.6 | |||||||||
Basic
|
335.5 | 332.7 | 320.4 | |||||||||
|
||||||||||||
Cash dividends paid per common share
|
$ | 1.08 | $ | 1.00 | $ | 1.00 |
Page 18
December 31 | ||||||||
(In millions) | 2010 | 2009 | ||||||
Assets
|
||||||||
Current assets
|
||||||||
Cash
|
$ | 333 | $ | 340 | ||||
Short-term investments
|
838 | 433 | ||||||
Accounts receivable-net
|
2,239 | 1,899 | ||||||
Inventory
|
1,564 | 1,326 | ||||||
Deferred income taxes
|
303 | 377 | ||||||
Prepaid expenses and other current assets
|
229 | 149 | ||||||
|
||||||||
Total current assets
|
5,506 | 4,524 | ||||||
|
||||||||
|
||||||||
Property, plant and equipment
|
||||||||
Land and buildings
|
1,494 | 1,459 | ||||||
Machinery and equipment
|
4,485 | 4,241 | ||||||
|
||||||||
Gross property, plant and equipment
|
5,979 | 5,700 | ||||||
Accumulated depreciation
|
(3,502 | ) | (3,255 | ) | ||||
|
||||||||
Net property, plant and equipment
|
2,477 | 2,445 | ||||||
|
||||||||
|
||||||||
Other noncurrent assets
|
||||||||
Goodwill
|
5,454 | 5,435 | ||||||
Other intangible assets
|
2,272 | 2,441 | ||||||
Deferred income taxes
|
1,001 | 973 | ||||||
Other assets
|
542 | 464 | ||||||
|
||||||||
Total assets
|
$ | 17,252 | $ | 16,282 | ||||
|
||||||||
|
||||||||
Liabilities and shareholders equity
|
||||||||
Current liabilities
|
||||||||
Short-term debt
|
$ | 72 | $ | 113 | ||||
Current portion of long-term debt
|
4 | 5 | ||||||
Accounts payable
|
1,408 | 1,057 | ||||||
Accrued compensation
|
465 | 256 | ||||||
Other current liabilities
|
1,284 | 1,258 | ||||||
|
||||||||
Total current liabilities
|
3,233 | 2,689 | ||||||
|
||||||||
|
||||||||
Noncurrent liabilities
|
||||||||
Long-term debt
|
3,382 | 3,349 | ||||||
Pension liabilities
|
1,429 | 1,586 | ||||||
Other postretirement benefits liabilities
|
743 | 754 | ||||||
Deferred income taxes
|
487 | 550 | ||||||
Other noncurrent liabilities
|
575 | 536 | ||||||
|
||||||||
Total noncurrent liabilities
|
6,616 | 6,775 | ||||||
|
||||||||
|
||||||||
Shareholders equity
|
||||||||
Common shares (339.9 million outstanding in 2010 and 332.3 million in 2009)
|
170 | 166 | ||||||
Capital in excess of par value
|
4,093 | 3,947 | ||||||
Retained earnings
|
4,455 | 3,893 | ||||||
Accumulated other comprehensive loss
|
(1,348 | ) | (1,208 | ) | ||||
Deferred compensation plans
|
(8 | ) | (21 | ) | ||||
|
||||||||
Total Eaton shareholders equity
|
7,362 | 6,777 | ||||||
Noncontrolling interests
|
41 | 41 | ||||||
|
||||||||
Total equity
|
7,403 | 6,818 | ||||||
|
||||||||
Total liabilities and equity
|
$ | 17,252 | $ | 16,282 | ||||
|
Page 19
Year ended December 31 | ||||||||||||
(In millions) | 2010 | 2009 | 2008 | |||||||||
Operating activities
|
||||||||||||
Net income
|
$ | 937 | $ | 385 | $ | 1,070 | ||||||
Adjustments to reconcile to net cash provided by operating activities
|
||||||||||||
Depreciation and amortization
|
551 | 573 | 571 | |||||||||
Deferred income taxes
|
26 | (191 | ) | (225 | ) | |||||||
Pension expense
|
179 | 270 | 215 | |||||||||
Contributions to pension plans
|
(403 | ) | (271 | ) | (210 | ) | ||||||
Changes in working capital
|
||||||||||||
Accounts receivable-net
|
(305 | ) | 440 | 128 | ||||||||
Inventory
|
(219 | ) | 292 | 118 | ||||||||
Accounts payable
|
322 | (73 | ) | (208 | ) | |||||||
Other-net
|
194 | (17 | ) | (18 | ) | |||||||
|
||||||||||||
Net cash provided by operating activities
|
1,282 | 1,408 | 1,441 | |||||||||
|
||||||||||||
|
||||||||||||
Investing activities
|
||||||||||||
Capital expenditures for property, plant and equipment
|
(394 | ) | (195 | ) | (448 | ) | ||||||
Cash paid for acquisitions of businesses
|
(222 | ) | (10 | ) | (2,807 | ) | ||||||
(Purchases) sales of short-term investments-net
|
(392 | ) | (64 | ) | 100 | |||||||
Other-net
|
(4 | ) | 44 | (35 | ) | |||||||
|
||||||||||||
Net cash used in investing activities
|
(1,012 | ) | (225 | ) | (3,190 | ) | ||||||
|
||||||||||||
|
||||||||||||
Financing activities
|
||||||||||||
Borrowings with original maturities of more than three months
|
||||||||||||
Proceeds
|
55 | 558 | 1,656 | |||||||||
Payments
|
(65 | ) | (887 | ) | (984 | ) | ||||||
Borrowings with original maturities of less than
three months-net (primarily commercial paper)
|
(37 | ) | (424 | ) | (5 | ) | ||||||
Cash dividends paid
|
(363 | ) | (334 | ) | (320 | ) | ||||||
Sale of common shares
|
| | 1,522 | |||||||||
Exercise of employee stock options
|
157 | 27 | 47 | |||||||||
Purchase of common shares
|
| | (100 | ) | ||||||||
Other-net
|
(8 | ) | (1 | ) | (1 | ) | ||||||
|
||||||||||||
Net cash (used in) provided by financing activities
|
(261 | ) | (1,061 | ) | 1,815 | |||||||
|
||||||||||||
|
||||||||||||
Effect of foreign exchange rate changes on cash
|
(16 | ) | 30 | (20 | ) | |||||||
|
||||||||||||
Total (decrease) increase in cash
|
(7 | ) | 152 | 46 | ||||||||
Cash at the beginning of the year
|
340 | 188 | 142 | |||||||||
|
||||||||||||
Cash at the end of the year
|
$ | 333 | $ | 340 | $ | 188 | ||||||
|
Page 20
Accumulated | Total | |||||||||||||||||||||||||||||||||||
Capital in | other | Deferred | Eaton | |||||||||||||||||||||||||||||||||
Common shares | excess of | Retained | comprehensive | compensation | shareholders | Noncontrolling | Total | |||||||||||||||||||||||||||||
(In millions) | Shares | Dollars | par value | earnings | loss | plans | equity | interests | equity | |||||||||||||||||||||||||||
Balance at January 1, 2008
|
292.0 | $ | 146 | $ | 2,290 | $ | 3,184 | $ | (423 | ) | $ | (25 | ) | $ | 5,172 | $ | 59 | $ | 5,231 | |||||||||||||||||
Net income
|
| | | 1,058 | | | 1,058 | 12 | 1,070 | |||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Foreign currency translation and related
hedging instruments (net of income
tax benefit of $68)
|
| | | | (722 | ) | | (722 | ) | | (722 | ) | ||||||||||||||||||||||||
Pensions (net of income tax benefit of $227)
|
| | | | (419 | ) | | (419 | ) | | (419 | ) | ||||||||||||||||||||||||
Other postretirement benefits (net of income
tax expense of $31)
|
| | | | 49 | | 49 | | 49 | |||||||||||||||||||||||||||
Cash flow hedges (net of income tax benefit of $12)
|
| | | | (23 | ) | | (23 | ) | | (23 | ) | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Other comprehensive loss
|
(1,115 | ) | | (1,115 | ) | |||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Total comprehensive loss
|
(57 | ) | 12 | (45 | ) | |||||||||||||||||||||||||||||||
Effects of changing retirement benefit plans
measurement date (net of income tax
benefit of $8)
|
| | | (11 | ) | | | (11 | ) | | (11 | ) | ||||||||||||||||||||||||
Cash dividends paid
|
| | | (320 | ) | | | (320 | ) | (13 | ) | (333 | ) | |||||||||||||||||||||||
Issuance of shares under employee benefit
plans-net (net of income tax benefit of $16)
|
3.4 | 2 | 109 | (2 | ) | | 2 | 111 | | 111 | ||||||||||||||||||||||||||
Sale of shares
|
37.4 | 19 | 1,503 | | | | 1,522 | | 1,522 | |||||||||||||||||||||||||||
Purchase of shares
|
(2.8 | ) | (2 | ) | (33 | ) | (65 | ) | | | (100 | ) | | (100 | ) | |||||||||||||||||||||
Decrease in noncontrolling interests due to
sale of business
|
| | | | | | | (10 | ) | (10 | ) | |||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Balance at December 31, 2008
|
330.0 | 165 | 3,869 | 3,844 | (1,538 | ) | (23 | ) | 6,317 | 48 | 6,365 |
Page 21
Accumulated | Total | |||||||||||||||||||||||||||||||||||
Capital in | other | Deferred | Eaton | |||||||||||||||||||||||||||||||||
Common shares | excess of | Retained | comprehensive | compensation | shareholders | Noncontrolling | Total | |||||||||||||||||||||||||||||
(In millions) | Shares | Dollars | par value | earnings | loss | plans | equity | interests | equity | |||||||||||||||||||||||||||
Balance at December 31, 2008
|
330.0 | 165 | 3,869 | 3,844 | (1,538 | ) | (23 | ) | 6,317 | 48 | 6,365 | |||||||||||||||||||||||||
Net income
|
| | | 383 | | | 383 | 2 | 385 | |||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Foreign currency translation and related
hedging instruments (net of income
tax expense of $45)
|
| | | | 349 | | 349 | | 349 | |||||||||||||||||||||||||||
Pensions (net of income tax expense of $42)
|
| | 1 | | 1 | | 1 | |||||||||||||||||||||||||||||
Other postretirement benefits (net of income
tax benefit of $14)
|
| | | | (56 | ) | | (56 | ) | | (56 | ) | ||||||||||||||||||||||||
Cash flow hedges (net of income tax expense of $19)
|
| | | | 36 | | 36 | | 36 | |||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Other comprehensive income
|
330 | | 330 | |||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Total comprehensive income
|
713 | 2 | 715 | |||||||||||||||||||||||||||||||||
Cash dividends paid
|
| | | (334 | ) | | | (334 | ) | (5 | ) | (339 | ) | |||||||||||||||||||||||
Issuance of shares under employee benefit
plans-net (net of income tax benefit of $3)
|
2.3 | 1 | 78 | | | 2 | 81 | | 81 | |||||||||||||||||||||||||||
Decrease in noncontrolling interests due to
sale of business
|
| | | | | | | (4 | ) | (4 | ) | |||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Balance at December 31, 2009
|
332.3 | 166 | 3,947 | 3,893 | (1,208 | ) | (21 | ) | 6,777 | 41 | 6,818 |
Page 22
Accumulated | Total | |||||||||||||||||||||||||||||||||||
Capital in | other | Deferred | Eaton | |||||||||||||||||||||||||||||||||
Common shares | excess of | Retained | comprehensive | compensation | shareholders | Noncontrolling | Total | |||||||||||||||||||||||||||||
(In millions) | Shares | Dollars | par value | earnings | loss | plans | equity | interests | equity | |||||||||||||||||||||||||||
Balance at December 31, 2009
|
332.3 | 166 | 3,947 | 3,893 | (1,208 | ) | (21 | ) | 6,777 | 41 | 6,818 | |||||||||||||||||||||||||
Net income
|
| | | 929 | | | 929 | 8 | 937 | |||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Foreign currency translation and related
hedging instruments
|
| | | | (78 | ) | | (78 | ) | | (78 | ) | ||||||||||||||||||||||||
Pensions (net of income tax benefit of $30)
|
| | | | (61 | ) | | (61 | ) | | (61 | ) | ||||||||||||||||||||||||
Other postretirement benefits (net of income
tax benefit of $4)
|
| | | | (1 | ) | | (1 | ) | | (1 | ) | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Other comprehensive loss
|
(140 | ) | | (140 | ) | |||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Total comprehensive income
|
789 | 8 | 797 | |||||||||||||||||||||||||||||||||
Cash dividends paid
|
| | | (363 | ) | | | (363 | ) | (8 | ) | (371 | ) | |||||||||||||||||||||||
Issuance of shares under employee benefit
plans-net (net of income tax expense of $3)
|
7.6 | 4 | 146 | (4 | ) | | 13 | 159 | | 159 | ||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
Balance at December 31, 2010
|
339.9 | $ | 170 | $ | 4,093 | $ | 4,455 | $ | (1,348 | ) | $ | (8 | ) | $ | 7,362 | $ | 41 | $ | 7,403 | |||||||||||||||||
|
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Table of Contents
Table of Contents
Business
Annual
Acquired business
Date of transaction
segment
sales
A China-based manufacturer of uninterruptible power
supply (UPS) systems. Eaton acquired the remaining
shares to increase its ownership from 50% to 100%.
October 12,
2010
Electrical
Rest of World
$25 for the
year ended September 30, 2010
A United States-based manufacturer of electrical and
electromechanical systems.
October 1,
2010
Electrical
Americas
$35 for the
year ended September 30, 2010
A United States provider of customized enclosures, rack
systems, and air-flow management systems to store,
power, and secure mission-critical IT data center
electronics.
August 25,
2010
Electrical
Americas
$101 for the
year ended June 30, 2010
Table of Contents
Business
Annual
Acquired business
Date of transaction
segment
sales
A United States energy engineering and energy services
company that delivers energy efficiency solutions for a
wide range of governmental, educational, commercial and
industrial facilities.
July 15,
2010
Electrical
Americas
$24 for 2009
A Switzerland-based manufacturer of human machine
interfaces, programmable logic controllers and
input/output devices. Eaton acquired the remaining
shares to increase its ownership from 50% to 100%.
September 1,
2009
Electrical
Rest of World
$33 for 2008
A 49%-owned joint venture in Abu Dhabi that manufactures
low-voltage switchboards and control panel assemblies
for use in the Middle East power generation and
industrial markets.
July 2,
2009
Electrical
Rest of World
$10 for 2008
The parent company of Integrated Hydraulics Ltd., a
United Kingdom-based manufacturer of screw-in cartridge
valves, custom-engineered hydraulic valves and manifold
systems.
October 2,
2008
Hydraulics
$52 for 2007
A 49%-owned joint venture to manage the global design,
manufacture and supply of engine valves and valve
actuation products to Japanese and Korean automobile and
engine manufacturers. In addition, during the second
half of 2008, several related manufacturing joint
ventures were established.
Operational
October 1, 2008
Automotive
Joint
venture
An India-based designer, manufacturer and distributor of
intake and exhaust valves for diesel and gasoline
engines.
July 31,
2008
Automotive
$5 for 2007
A Belgium-based distributor and service provider of
single-phase and three-phase uninterruptible power
supply (UPS) systems.
July 31,
2008
Electrical
Rest of World
$9 for 2007
A Germany-based supplier of electrical components for
commercial and residential building applications and
industrial controls for industrial equipment
applications.
April 4,
2008
Electrical
Rest of World
$1.4 billion
(1.02 billion) for 2007
A Spain-based distributor and service provider of
uninterruptible power supply (UPS) systems.
March 31,
2008
Electrical
Rest of World
$6 for 2007
A Taiwan-based manufacturer of single- and three-phase
uninterruptible power supply (UPS) systems.
February 26,
2008
Electrical
Rest of World
$515 for 2007
Table of Contents
2010
2009
2008
$
2
$
4
$
4
33
60
43
1
3
6
4
12
20
1
3
40
80
76
2
1
$
40
$
82
$
77
$
27
$
54
$
51
$
0.08
$
0.16
$
0.17
Plant
Workforce reductions
closing
Employees
Dollars
and other
Total
563
$
14
$
1
$
15
422
21
87
108
(451
)
(14
)
(84
)
(98
)
534
21
4
25
12,073
195
69
264
(11,189
)
(173
)
(61
)
(234
)
1,418
43
12
55
202
7
33
40
(1,293
)
(39
)
(40
)
(79
)
327
$
11
$
5
$
16
Table of Contents
2010
2009
$
2,061
$
2,003
985
1,005
1,007
1,016
1,037
1,047
151
147
213
217
$
5,454
$
5,435
2010
2009
Historical
Accumulated
Historical
Accumulated
cost
amortization
cost
amortization
$
451
$
451
$
1,187
$
274
$
1,181
$
204
835
260
885
245
441
108
456
83
$
2,463
$
642
$
2,522
$
532
$
152
150
149
140
134
130
Table of Contents
2010
2009
$
300
$
300
12
12
($200 converted to floating rate by interest rate swap)
300
300
7
7
($100 converted to floating rate by interest rate swap)
250
250
9
9
100
100
250
250
36
36
($115 converted to floating rate by interest rate swap)
450
450
123
108
300
300
($25 converted to floating rate by interest rate swap)
38
38
100
100
($25 converted to floating rate by interest rate swap)
66
66
145
145
72
72
($50 converted to floating rate by interest rate swap)
200
200
($25 converted to floating rate by interest rate swap)
140
140
42
42
240
240
206
189
3,386
3,354
(4
)
(5
)
$
3,382
$
3,349
$
4
317
310
262
104
$
206
180
170
Table of Contents
United States
Non-United States
Other postretirement
pension liabilities
pension liabilities
liabilities
2010
2009
2010
2009
2010
2009
$
1,572
$
1,210
$
937
$
832
$
$
(2,458
)
(2,244
)
(1,460
)
(1,366
)
(826
)
(830
)
$
(886
)
$
(1,034
)
$
(523
)
$
(534
)
$
(826
)
$
(830
)
Consolidated Balance Sheets
$
$
$
52
$
50
$
$
(9
)
(8
)
(23
)
(24
)
(83
)
(76
)
(877
)
(1,026
)
(552
)
(560
)
(743
)
(754
)
$
(886
)
$
(1,034
)
$
(523
)
$
(534
)
$
(826
)
$
(830
)
Accumulated other
comprehensive loss (pretax)
$
1,142
$
1,107
$
311
$
256
$
232
$
228
8
7
(11
)
(12
)
$
1,142
$
1,107
$
319
$
263
$
221
$
216
United States
Non-United States
Other postretirement
pension liabilities
pension liabilities
liabilities
2010
2009
2010
2009
2010
2009
$
2,244
$
2,145
$
1,366
$
1,143
$
830
$
779
80
76
39
34
16
15
131
133
69
70
46
49
133
98
94
100
15
70
(122
)
(229
)
(76
)
(89
)
(88
)
(96
)
(53
)
98
1
3
(8
)
21
21
10
6
10
$
2,458
$
2,244
$
1,460
$
1,366
$
826
$
830
$
2,366
$
2,143
$
1,330
$
1,261
United States
Non-United States
Other postretirement
pension liabilities
pension liabilities
liabilities
2010
2009
2010
2009
2010
2009
$
1,210
$
994
$
832
$
680
$
$
182
253
96
77
313
192
90
79
88
96
(122
)
(229
)
(76
)
(89
)
(88
)
(96
)
(21
)
79
(11
)
16
6
$
1,572
$
1,210
$
937
$
832
$
$
Table of Contents
United States
Non-United States
pension liabilities
pension liabilities
2010
2009
2010
2009
$
2,458
$
2,244
$
1,114
$
1,146
2,366
2,143
1,026
1,074
1,572
1,210
554
582
United States
Non-United States
Other postretirement
pension liabilities
pension liabilities
liabilities
2010
2009
2010
2009
2010
2009
$
1,107
$
1,244
$
263
$
169
$
216
$
146
1
4
1
1
107
(24
)
60
83
15
70
(5
)
21
1
(69
)
(117
)
(8
)
(11
)
(10
)
(1
)
(4
)
8
35
(137
)
56
94
5
70
$
1,142
$
1,107
$
319
$
263
$
221
$
216
United States
Non-United States
Other postretirement
pension benefit expense
pension benefit expense
benefits expense
2010
2009
2008
2010
2009
2008
2010
2009
2008
$
80
$
76
$
94
$
39
$
34
$
43
$
16
$
15
$
15
131
133
122
69
70
68
46
49
49
(156
)
(131
)
(138
)
(62
)
(58
)
(60
)
53
34
42
8
4
7
10
1
11
108
112
120
54
50
58
72
65
75
1
17
5
1
1
16
83
33
3
2
$
125
$
212
$
153
$
54
$
58
$
61
$
72
$
66
$
75
Table of Contents
Other
United States
Non-United States
postretirement
pension liabilities
pension liabilities
liabilities
$
93
$
15
$
13
2
(2
)
$
93
$
17
$
11
United States
Non-United States
pension plans
pension plans
2010
2009
2008
2010
2009
2008
5.50
%
6.00
%
6.30
%
5.40
%
5.59
%
6.26
%
3.61
%
3.62
%
3.64
%
3.63
%
3.58
%
3.56
%
6.00
%
6.30
%
6.00
%
5.59
%
6.26
%
5.93
%
8.95
%
8.94
%
8.94
%
7.20
%
7.06
%
7.39
%
3.62
%
3.64
%
3.64
%
3.58
%
3.56
%
3.60
%
Other postretirement benefits plans
2010
2009
2008
5.20
%
5.70
%
6.30
%
8.10
%
8.30
%
8.25
%
4.50
%
4.75
%
4.75
%
2020
2017
2017
5.70
%
6.30
%
6.00
%
8.30
%
8.25
%
8.30
%
4.75
%
4.75
%
4.75
%
2017
2017
2015
1% increase
1% decrease
$
$
17
(15
)
Table of Contents
2011
2010
2009
2008
$
259
$
313
$
192
$
124
94
90
79
86
$
353
$
403
$
271
$
210
Estimated other postretirement
benefit payments
Estimated
Estimated
Medicare
United States
non-United States
prescription
pension payments
pension payments
Gross
drug subsidy
$
130
$
69
$
93
$
(8
)
134
71
91
(8
)
283
72
88
(8
)
181
74
85
(8
)
188
77
84
(7
)
1,090
424
347
(24
)
Level 1 Quoted prices (unadjusted) for identical assets in active markets.
Level 2 Quoted prices for similar assets in active markets, and inputs that are
observable for the asset, either
directly or indirectly, for substantially the full term of the financial instrument.
Level 3 Unobservable prices or inputs.
Table of Contents
Quoted prices
in active
markets for
Other
identical
observable
Unobservable
assets
inputs
inputs
Total
(Level 1)
(Level 2)
(Level 3)
$
965
$
$
965
$
577
577
241
241
91
91
230
230
101
101
81
81
78
78
77
10
67
32
32
36
2
34
$
2,509
$
304
$
2,171
$
34
$
839
$
$
839
$
646
646
296
296
84
84
27
27
37
37
25
25
28
1
27
21
21
39
7
3
29
$
2,042
$
70
$
1,943
$
29
Common collective trusts
Valued at the net unit value of units held by the trust at year
end. The unit value is determined by the total value of fund assets divided by the total
number of units of the fund owned. The equity investments in collective trusts are
predominantly in index funds for which the underlying securities are actively traded in public
markets based upon readily measurable prices.
Fixed income securities
These securities consist of publicly traded Unites States and
non-United States fixed interest obligations (principally corporate and government bonds and
debentures). The fair value of corporate and government debt securities is determined through
models that consider various assumptions, including time value, yield curves, credit ratings
and current market prices.
United States treasuries
Valued at the closing price of each security.
Real estate and equity securities
These securities consist of direct investments in the
stock of publicly traded companies. Such investments are valued based on the closing price
reported in an active market on which the individual securities are traded. As such, the
direct investments are classified as Level 1.
Cash equivalents
Primarily certificates of deposit, commercial paper and repurchase
agreements.
Registered investment companies
Valued at the closing price of the exchange traded funds shares.
Table of Contents
Other fixed income
Asset backed securities, agencies and variable rate bonds valued based
on pricing models which incorporate information from market sources and observed market
movements.
Other
Primarily insurance contracts for international plans and also futures contracts
and over-the-counter options. These investments are valued based on the closing prices of
future contracts or indices as available on the Bloomberg or similar service, and private
equity investments.
$
64
25
33
Table of Contents
2010
2009
2008
$
147
$
165
$
167
99
77
95
(91
)
(98
)
(108
)
13
(2
)
3
(2
)
$
153
$
147
$
165
$
145
106
78
49
39
59
$
476
$
173
177
172
Income (loss) from continuing operations
before income taxes
2010
2009
2008
$
114
$
(298
)
$
123
922
601
1,017
$
1,036
$
303
$
1,140
Table of Contents
Income tax expense (benefit) from
continuing operations
2010
2009
2008
$
(2
)
$
40
$
36
1
5
4
107
69
219
106
114
259
95
(174
)
(17
)
(15
)
(4
)
(42
)
(87
)
(18
)
(127
)
(7
)
(196
)
(186
)
$
99
$
(82
)
$
73
2010
2009
2008
35.0
%
35.0
%
35.0
%
(0.1
)%
0.4
%
0.3
%
(0.6
)%
(2.1
)%
(0.5
)%
(0.8
)%
(2.3
)%
(0.6
)%
(1.4
)%
(3.9
)%
(1.2
)%
2.2
%
0.0
%
0.0
%
1.4
%
5.0
%
4.8
%
(6.4
)%
(2.5
)%
(3.0
)%
(earnings taxed at other than the United States tax rate)
(13.9
)%
(52.6
)%
(18.9
)%
(1.2
)%
(11.9
)%
(3.6
)%
(4.7
)%
7.7
%
(5.9
)%
9.5
%
(27.2
)%
6.4
%
Table of Contents
$
185
124
141
2010
2009
Long-term
Long-term
Current
assets and
Current
assets and
assets
liabilities
assets
liabilities
$
94
$
681
$
78
$
773
(1
)
(567
)
3
(642
)
224
90
293
103
(6
)
(5
)
5
13
38
253
165
74
72
360
291
72
66
(421
)
(360
)
(14
)
(27
)
(10
)
(78
)
$
303
$
514
$
377
$
423
(1)
United States deferred income tax assets of $37 for income tax loss
carryforwards were reduced by $32 for the excess income tax benefit related to the exercise of
stock options. A tax benefit and a credit to Capital in excess of par value for the excess benefit will
not be recognized until the deduction reduces income taxes payable. The net income tax loss
carryforward of $37 in the table below reflects the $32 related to the excess income tax benefit.
2011
2016
2021
2026
Not
through
through
through
through
subject to
Valuation
2015
2020
2025
2030
expiration
allowance
$
2
$
$
13
$
92
$
$
1
4
32
(6
)
109
10
83
51
(18
)
2011
2016
2021
2026
Not
through
through
through
through
subject to
Valuation
2015
2020
2025
2030
expiration
allowance
$
5
$
6
$
15
$
10
$
3
$
(10
)
10
10
6
4
5
(20
)
Table of Contents
2011
2016
2021
2026
Not
through
through
through
through
subject to
Valuation
2015
2020
2025
2030
expiration
allowance
$
161
$
155
$
46
$
4
$
947
$
41
42
14
1
262
(331
)
5
60
1
6
(11
)
Table of Contents
2010
2009
2008
$
197
$
139
$
96
(2
)
(1
)
(2
)
7
37
11
(31
)
(4
)
(18
)
34
5
30
23
28
35
(4
)
(4
)
(3
)
(13
)
$
224
$
197
$
139
Table of Contents
2010
2009
$
(261
)
$
(183
)
(972
)
(911
)
(122
)
(121
)
7
7
$
(1,348
)
$
(1,208
)
(Shares in millions)
2010
2009
2008
$
929
$
383
$
1,055
3
$
929
$
383
$
1,058
339.5
335.8
324.6
4.0
3.1
4.2
335.5
332.7
320.4
$
2.73
$
1.14
$
3.25
.01
$
2.73
$
1.14
$
3.26
$
2.76
$
1.16
$
3.29
.01
$
2.76
$
1.16
$
3.30
Table of Contents
2010
2009
2008
31
%
30
%
27% to 22%
5.5
5.5
5.5
2.0
%
2.0
%
2.0
%
2.4% to 1.3
%
2.2% to 1.7
%
3.6% to 1.7
%
$
8.98
$
5.14
$
8.30
Weighted-
average
Weighted-
remaining
average price
contractual
Aggregate
(Options in millions)
per option
Options
life in years
intrinsic value
$
32.19
21.1
34.90
0.1
26.16
(6.1
)
37.43
(0.2
)
$
34.62
14.9
5.1
$
241
$
34.10
13.6
4.8
$
227
10.8
2010
2009
2008
$
11
$
28
$
29
8
19
20
157
27
47
2
4
4
13
98
19
52
$
11
$
22
$
31
6.096
1.688
2.480
Table of Contents
Weighted-
Number of
average fair
restricted
value per
(Restricted stock units in millions)
stock units
award
4.2
$
24.30
1.8
33.28
(0.8
)
31.36
25.11
5.2
$
26.48
2010
2009
2008
$
39
$
25
$
15
25
17
10
Quoted prices in
active markets
Other
for identical
observable
Unobservable
assets
inputs
inputs
Total
(Level 1)
(Level 2)
(Level 3)
$
333
$
333
$
$
838
838
69
69
42
42
$
340
$
340
$
$
433
433
25
25
29
29
Table of Contents
2010
2009
$
592
$
300
246
125
8
$
838
$
433
Hedges of the change in the fair value of a recognized fixed-rate asset or liability, or
the firm commitment to acquire such an asset or liability (a fair value hedge); for these
hedges, the gain or loss from the derivative financial instrument, as well as the
offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized
in income during the period of change in fair value.
Hedges of the variable cash flows of a recognized variable-rate asset or liability, or
the forecasted acquisition of such an asset or liability (a cash flow hedge); for these
hedges, the effective portion of the gain or loss from the derivative financial instrument
is recognized in Accumulated other comprehensive loss and reclassified to income in the
same period when the gain or loss on the hedged item is included in income.
Hedges of the foreign currency exposure related to a net investment in a foreign
operation (a net investment hedge); for these hedges, the effective portion of the gain or
loss from the derivative financial instrument is recognized in Accumulated other
comprehensive loss and reclassified to income in the same period when the gain or loss
related to the net investment in the foreign operation is included in income.
Table of Contents
Notional
Fixed interest
Floating interest
Basis for contracted floating
amount
rate received
rate paid
interest rate paid
$
200
4.90
%
2.59
%
6 month LIBOR + 2.15%
100
5.95
%
3.07
%
6 month LIBOR + 2.60%
115
5.60
%
1.66
%
6 month LIBOR + 1.22%
25
8.875
%
4.30
%
6 month LIBOR + 3.84%
25
7.625
%
2.94
%
6 month LIBOR + 2.48%
50
7.65
%
3.01
%
6 month LIBOR + 2.57%
25
5.45
%
0.73
%
6 month LIBOR + 0.28%
Other
Other
Other
Notional
current
long-term
current
Type of
amount
assets
assets
liabilities
hedge
Term
$
540
$
$
42
$
Fair value
2 to 23 years
227
4
5
Cash flow
12 to 36 months
39
8
Cash flow
12 months
75
2
Net investment
12 months
$
14
$
42
$
5
$
2,777
$
20
$
19
12 months
102
17
12 months
$
37
$
19
$
700
$
$
29
$
Fair value
3 to 24 years
159
6
4
Cash flow
12 to 36 months
20
5
Cash flow
12 months
$
11
$
29
$
4
$
3,602
$
17
$
31
12 months
30
3
12 months
$
20
$
31
Table of Contents
2010
2009
Gain (loss)
Gain (loss)
Gain (loss)
reclassified
Gain (loss)
reclassified
recognized in
from
recognized in
from
Accumulated
Accumulated
Accumulated
Accumulated
other
other
other
other
comprehensive
comprehensive
comprehensive
comprehensive
loss
loss
loss
loss
$
(2
)
$
1
$
(1
)
$
(8
)
8
5
22
(14
)
(8
)
$
(2
)
$
6
$
21
$
(22
)
Gain (loss) recognized in net
income
2010
2009
$
33
$
(47
)
(33
)
47
$
$
Table of Contents
2010
2009
$
651
$
608
229
222
800
601
1,680
1,431
(116
)
(105
)
$
1,564
$
1,326
Table of Contents
Table of Contents
2010
2009
2008
$
3,675
$
3,410
$
4,016
2,748
2,483
2,904
2,212
1,692
2,523
1,536
1,602
1,811
1,997
1,457
2,251
1,547
1,229
1,871
$
13,715
$
11,873
$
15,376
$
529
$
518
$
630
264
107
233
279
51
285
220
245
283
245
39
315
163
(10
)
59
1,700
950
1,805
(181
)
(170
)
(161
)
(136
)
(150
)
(157
)
(120
)
(212
)
(141
)
(11
)
(28
)
(29
)
(216
)
(87
)
(177
)
1,036
303
1,140
99
(82
)
73
937
385
1,067
3
937
385
1,070
(8
)
(2
)
(12
)
$
929
$
383
$
1,058
$
2
$
4
$
4
33
60
43
1
3
6
4
12
20
1
3
$
40
$
80
$
76
Table of Contents
2010
2009
2008
$
1,272
$
1,050
$
1,238
1,630
1,625
1,817
1,080
939
1,132
726
729
798
866
797
801
904
866
947
6,478
6,006
6,733
5,454
5,435
5,232
2,272
2,441
2,518
3,048
2,400
2,172
$
17,252
$
16,282
$
16,655
$
59
$
30
$
85
49
39
77
45
21
54
21
16
23
59
30
69
61
24
54
294
160
362
100
35
86
$
394
$
195
$
448
$
55
$
56
$
61
56
61
49
52
57
59
25
26
27
76
83
89
77
85
97
341
368
382
28
30
27
$
369
$
398
$
409
Table of Contents
Long-lived
Net sales
assets
$
7,686
$
1,102
426
25
1,453
275
3,396
664
2,156
411
(1,402
)
$
13,715
$
2,477
$
6,767
$
1,024
355
23
1,061
272
3,007
748
1,642
378
(959
)
$
11,873
$
2,445
$
8,775
$
1,129
428
21
1,455
250
4,002
827
1,963
412
(1,247
)
$
15,376
$
2,639
Table of Contents
2010
2009
2008
$
13,715
$
11,873
$
15,376
929
383
1,058
$
2.73
$
1.14
$
3.26
Table of Contents
Change
Change
from
from
2010
2009
2009
2008
2008
$
13,715
16
%
$
11,873
(23
)%
$
15,376
4,082
32
%
3,091
(26
)%
4,185
29.8
%
26.0
%
27.2
%
1,036
242
%
303
(73
)%
1,140
$
937
143
%
$
385
(64
)%
$
1,067
3
937
143
%
385
(64
)%
1,070
(8
)
(2
)
(12
)
929
143
%
383
(64
)%
1,058
27
54
51
$
956
119
%
$
437
(61
)%
$
1,109
$
2.73
141
%
$
1.14
(65
)%
$
3.25
0.08
0.16
0.17
$
2.81
117
%
$
1.30
(62
)%
$
3.42
Table of Contents
Change
Change
from
from
2010
2009
2009
2008
2008
$
3,675
8
%
$
3,410
(15
)%
$
4,016
529
2
%
518
(18
)%
630
14.4
%
15.2
%
15.7
%
$
2
$
4
$
4
$
531
2
%
$
522
(18
)%
$
634
14.4
%
15.3
%
15.8
%
Table of Contents
Change
Change
from
from
2010
2009
2009
2008
2008
$
2,748
11
%
$
2,483
(15
)%
$
2,904
264
147
%
107
(54
)%
233
9.6
%
4.3
%
8.0
%
$
33
$
60
$
43
$
297
78
%
$
167
(39
)%
$
276
10.8
%
6.7
%
9.5
%
Change
Change
from
from
2010
2009
2009
2008
2008
$
2,212
31
%
$
1,692
(33
)%
$
2,523
279
447
%
51
(82
)%
285
12.6
%
3.0
%
11.3
%
$
1
$
3
$
6
$
280
419
%
$
54
(81
)%
$
291
12.7
%
3.2
%
11.5
%
Table of Contents
Change
Change
from
from
2010
2009
2009
2008
2008
$
1,536
(4
)%
$
1,602
(12
)%
$
1,811
220
(10
)%
245
(13
)%
283
14.3
%
15.3
%
15.6
%
$
4
$
12
$
20
$
224
(13
)%
$
257
(15
)%
$
303
14.6
%
16.0
%
16.7
%
Change
Change
from
from
2010
2009
2009
2008
2008
$
1,997
37
%
$
1,457
(35
)%
$
2,251
245
528
%
39
(88
)%
315
12.3
%
2.7
%
14.0
%
Table of Contents
Change
Change
from
from
2010
2009
2009
2008
2008
$
1,547
26
%
$
1,229
(34
)%
$
1,871
163
NM
(10
)
NM
59
10.5
%
NM
3.2
%
End markets for the Electrical Americas segment are expected to grow 6% in 2011.
End markets for the Electrical Rest of World segment are expected to grow 7% in 2011, with
Asian growth outpacing growth in Europe.
Global hydraulics markets are anticipated to grow 16% in 2011, with United States markets
up 19% and non-United States markets up 14%.
End markets for the Aerospace segment are expected to grow by 4% in 2011, with growth in
United States markets of 4% and growth in non-United States markets
of 3%.
End markets for the Truck segment are expected to grow 20% in 2011, with United States
markets up 40% and non-United States markets up 7%.
End markets for the Automotive segment are expected to grow 6% in 2011, with United States
Automotive production up 7% and non-United States production up 5%.
Table of Contents
Table of Contents
Credit Rating Agency
Rating
Outlook
A-/A-2
Stable outlook
A3/P-2
Stable outlook
A-/F2
Stable outlook
Table of Contents
Table of Contents
Table of Contents
2012
2014
to
to
After
2011
2013
2015
2015
Total
$
4
$
627
$
366
$
2,207
$
3,204
191
347
285
1,109
1,932
(34
)
(47
)
(27
)
(70
)
(178
)
145
184
88
59
476
537
128
78
42
785
361
30
30
30
451
$
1,204
$
1,269
$
820
$
3,377
$
6,670
Table of Contents
Table of Contents
Quarter ended in 2010
Quarter ended in 2009
(In millions except for per share data)
Dec. 31
Sept. 30
June 30
Mar. 31
Dec. 31
Sept. 30
June 30
Mar. 31
$
3,663
$
3,571
$
3,378
$
3,103
$
3,131
$
3,028
$
2,901
$
2,813
1,098
1,091
991
902
890
850
712
639
30.0
%
30.6
%
29.3
%
29.1
%
28.4
%
28.1
%
24.5
%
22.7
%
293
305
251
187
170
166
30
(63
)
$
283
$
269
$
229
$
156
$
212
$
194
$
31
$
(52
)
(3
)
(1
)
(3
)
(1
)
(1
)
(1
)
(2
)
2
$
280
$
268
$
226
$
155
$
211
$
193
$
29
$
(50
)
$
0.82
$
0.78
$
0.66
$
0.46
$
0.62
$
0.57
$
0.09
$
(0.15
)
$
0.83
$
0.80
$
0.67
$
0.46
$
0.63
$
0.58
$
0.09
$
(0.15
)
$
0.29
$
0.29
$
0.25
$
0.25
$
0.25
$
0.25
$
0.25
$
0.25
$
51.35
$
42.17
$
40.89
$
38.47
$
33.53
$
30.33
$
24.88
$
26.67
40.49
31.48
32.66
30.42
26.98
20.14
18.02
15.01
Earnings per common share for the four quarters in a year may not equal full year earnings per share.
Significant non-recurring adjustments included in income before income taxes are as follows:
$
(15
)
$
(7
)
$
(9
)
$
(9
)
$
(27
)
$
(19
)
$
(15
)
$
(21
)
(26
)
(22
)
(69
)
(65
)
Table of Contents
(In millions except for per share data)
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
$
13,715
$
11,873
$
15,376
$
13,033
$
12,232
$
10,874
$
9,547
$
7,796
$
6,983
$
7,092
1,036
303
1,140
1,055
979
969
756
475
378
257
$
937
$
385
$
1,067
$
973
$
907
$
788
$
633
$
368
$
272
$
158
3
35
53
22
22
30
23
19
937
385
1,070
1,008
960
810
655
398
295
177
(8
)
(2
)
(12
)
(14
)
(10
)
(5
)
(7
)
(12
)
(14
)
(8
)
$
929
$
383
$
1,058
$
994
$
950
$
805
$
648
$
386
$
281
$
169
$
2.73
$
1.14
$
3.25
$
3.19
$
2.94
$
2.54
$
2.00
$
1.18
$
0.90
$
0.54
0.01
0.12
0.17
0.08
0.07
0.10
0.08
0.07
$
2.73
$
1.14
$
3.26
$
3.31
$
3.11
$
2.62
$
2.07
$
1.28
$
0.98
$
0.61
$
2.76
$
1.16
$
3.29
$
3.26
$
2.99
$
2.61
$
2.05
$
1.20
$
0.91
$
0.54
0.01
0.12
0.17
0.07
0.07
0.11
0.09
0.07
$
2.76
$
1.16
$
3.30
$
3.38
$
3.16
$
2.68
$
2.12
$
1.31
$
1.00
$
0.61
339.5
335.8
324.6
300.6
305.8
308.0
314.2
301.0
286.8
282.0
335.5
332.7
320.4
294.6
300.4
300.4
306.2
295.8
282.4
277.6
$
1.08
$
1.00
$
1.00
$
0.86
$
0.74
$
0.62
$
0.54
$
0.46
$
0.44
$
0.44
$
17,252
$
16,282
$
16,655
$
13,430
$
11,417
$
10,218
$
9,075
$
8,223
$
7,138
$
7,646
3,382
3,349
3,190
2,432
1,774
1,830
1,734
1,651
1,887
2,252
3,458
3,467
4,271
3,417
2,586
2,464
1,773
1,953
2,088
2,440
7,362
6,777
6,317
5,172
4,106
3,778
3,606
3,117
2,302
2,475
$
21.66
$
20.39
$
19.14
$
17.71
$
14.04
$
12.72
$
11.76
$
10.19
$
8.15
$
8.90
339.9
332.3
330.0
292.0
292.6
297.0
306.6
306.0
282.4
278.0
Table of Contents
2010 Annual Report on Form 10-K
Exhibit Index
3 (i)
Amended Articles of Incorporation (amended and restated as of April 24,
2008) Incorporated by reference to the Form 10-Q Report for the three months
ended March 31, 2008
3 (ii)
Amended Regulations (amended and restated as of February 24, 2010)
Incorporated by reference to the Form 8-K Report dated February 24, 2010
4 (a)
Pursuant to Regulation S-K Item 601(b) (4), the Company agrees to
furnish to the SEC, upon request, a copy of the instruments defining the rights of
holders of its other long-term debt
10
Material contracts
(a)
Senior Executive Incentive Compensation Plan (effective January 1,
2008) Incorporated by reference to the definitive Proxy Statement
dated March 14, 2008
(b)
Executive Incentive Compensation Plan (effective January 1, 2005)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2005
(c)
2005 Non-Employee Director Fee Deferral Plan (2008 restatement)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2007
(d)
Deferred Incentive Compensation Plan II (2008 restatement)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2007
(e)
Excess Benefits Plan II (2008 restatement) Incorporated by
reference to the Form 10-K Report for the year ended December 31,
2007
(f)
Incentive Compensation Deferral Plan II (2008 restatement)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2007
(g)
Limited Eaton Service Supplemental Retirement Income Plan II (2008
restatement) Incorporated by reference to the Form 10-K Report for
the year ended December 31, 2007
(h)
Supplemental Benefits Plan II (2008 restatement) Incorporated by
reference to the Form 10-K Report for the year ended December 31,
2007
(i)
Form of Restricted Share Unit Agreement (2 year vesting)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2007
(j)
Form of Restricted Share Unit Agreement (4 year vesting)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2007
(k)
Form of Restricted Share Agreement (2 year vesting) Incorporated by
reference to the Form 10-K Report for the year ended December 31,
2007
(l)
Form of Restricted Share Agreement (4 year vesting) Incorporated by
reference to the Form 10-K Report for the year ended December 31,
2007
(m)
Form of Restricted Share Agreement (Non-Employee Directors)
Incorporated by reference to the Form 8-K Report filed February 1,
2010
(n)
Form of Stock Option Agreement for Executives (2008) Incorporated
by reference to the Form 10-K Report for the year ended December 31,
2007
(o)
Form of Stock Option Agreement for Executives Incorporated by
reference to the Form 10-K Report for the year ended December 31,
2006
(p)
Form of Stock Option Agreement for Non-Employee Directors (2008)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2007
Table of Contents
(q)
2002 Stock Plan Incorporated by reference to the definitive Proxy
Statement dated March 15, 2002
(r)
2004 Stock Plan Incorporated by reference to the definitive Proxy
Statement dated March 19, 2004
(s)
2008 Stock Plan Incorporated by reference to the definitive Proxy
Statement dated March 14, 2008
(t)
2009 Stock Plan Incorporated by reference to the definitive Proxy
Statement dated March 13, 2009
(u)
Plan for the Deferred Payment of Directors Fees (originally adopted
in 1985 and amended effective September 24, 1996, January 28, 1998,
January 23, 2002, February 24, 2004, December 8, 2004 and, in certain
respects, January 1, 2005) Incorporated by reference to the Form
10-K Report for the year ended December 31, 2007
(v)
1996 Non-Employee Director Fee Deferral Plan (amended and restated
effective January 1, 2005) Incorporated by reference to the Form
10-K Report for the year ended December 31, 2006
(w)
Form of Change of Control Agreement entered into with officers of
Eaton Corporation Incorporated by reference to the Form 10-K Report
for the year ended December 31, 2008
(x)
Form of Indemnification Agreement entered into with officers of Eaton
Corporation Incorporated by reference to the Form 10-K Report for
the year ended December 31, 2002
(y)
Form of Indemnification Agreement entered into with directors of
Eaton Corporation Incorporated by reference to the Form 8-K Report
filed January 26, 2007
(z)
Executive Strategic Incentive Plan (amended and restated January 1,
2008) Incorporated by reference to the definitive Proxy Statement
dated March 14, 2008
(aa)
Executive Strategic Incentive Plan II (effective January 1, 2001)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2002
(bb)
Supplemental Executive Strategic Incentive Plan (effective as of June
25, 2008) Incorporated by reference to the Form 10-K Report for the
year ended December 31, 2008
(cc)
Deferred Incentive Compensation Plan (amended and restated effective
November 1, 2007) Incorporated by reference to the Form 10-K Report
for the year ended December 31, 2009
(dd)
1998 Stock Plan Incorporated by reference to the definitive Proxy
Statement dated March 13, 1998
(ee)
Incentive Compensation Deferral Plan (amended and restated October 1,
1997) Incorporated by reference to the Form 10-K Report for the
year ended December 31, 2000
(ff)
Trust Agreement Officers and Employees (dated December 6, 1996)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2002
(gg)
Trust Agreement Non-employee Directors (dated December 6, 1996)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2002
(hh)
Group Replacement Insurance Plan (GRIP) (effective June 1, 1992)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 1992
(ii)
1991 Stock Option Plan Incorporated by reference to the Form 10-K
Report for the year ended December 31, 2002
(jj)
Excess Benefits Plan (amended and restated effective January 1, 1989)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2002
Table of Contents
(kk)
Supplemental Benefits Plan (amended and restated January 1, 1989)
Incorporated by reference to the Form 10-K Report for the year ended
December 31, 2002
(ll)
Eaton Corporation Board of Directors Policy on Incentive
Compensation, Stock Options and Other Equity Grants upon the
Restatement of Financial Results Incorporated by reference to the
Form 10-K Report for the year ended December 31, 2007
(mm)
Amended and Restated Grantor Trust Agreement for Non-Employee
Directors Deferred Fees Plans effective January 1, 2010 Filed in
conjunction with this Form 10-K report.*
(nn)
Amended and Restated Grantor Trust Agreement for Employees Deferred
Compensation Plans effective January 1, 2010 Filed in
conjunction with this Form 10-K report.*
12
Ratio of Earnings to Fixed Charges Filed in conjunction with this Form 10-K Report *
14
Code of Ethics Incorporated by reference to the definitive Proxy Statement filed on March 14, 2008
21
Subsidiaries of Eaton Corporation Filed in conjunction with this Form 10-K Report *
23
Consent of Independent Registered Public Accounting Firm Filed in conjunction
with this Form 10-K
Report *
24
Power of Attorney Filed in conjunction with this Form 10-K Report *
31.1
Certification of Form 10-K (Pursuant to the Sarbanes-Oxley Act of 2002, Section
302) Filed in conjunction with this Form 10-K Report *
31.2
Certification of Form 10-K (Pursuant to the Sarbanes-Oxley Act of 2002, Section
302) Filed in conjunction with this Form 10-K Report *
32.1
Certification of Form 10-K (Pursuant to the Sarbanes-Oxley Act of 2002, Section
906) Filed in conjunction with this Form 10-K Report *
32.2
Certification of Form 10-K (Pursuant to the Sarbanes-Oxley Act of 2002, Section
906) Filed in conjunction with this Form 10-K Report *
101.INS
XBRL Instance Document *
101.SCH
XBRL Taxonomy Extension Schema Document *
101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document *
101.DEF
XBRL Taxonomy Extension Definition Linkbase Document *
101.LAB
XBRL Taxonomy Extension Label Linkbase Document *
101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document *
*
Submitted electronically herewith.
2
3
4
5
6
7
8
9
10
11
12
(i) | Any participant shall have notified the Company and the Recordkeeper in writing that the Company has failed to pay to the participant, when due, either directly or by direction to the Trustee in accordance with the terms hereof, at least 75% of any and all amounts which the participant was entitled to receive at any time in accordance with the terms of any of the Plans, the Payment Schedule or this Trust Agreement, and that such amount remains unpaid. Such notice must set forth the amount, if any, which was paid to the participant, and the amount which the participant believes he |
13
or she was entitled to receive under the Plans, the Payment Schedule and this Trust Agreement; or | |||
(ii) | More than two Plan participants shall have notified the Company and the Recordkeeper in writing, either individually or jointly, that they have not been paid, when due, amounts to which they are entitled under the Plans, the Payment Schedule or this Trust Agreement, and that such amount remains unpaid. Each such notice must set forth the amount, if any, which was paid to the participant, and the amount which the participant believes he or she was entitled to receive under the Plans, the Payment Schedule and this Trust agreement. Within 15 days after receipt of each such notice, the Company or Fiduciary shall determine, on a preliminary basis, whether any failure to pay such participants has resulted in a failure to pay when due, directly or by direction, at least 75% of the aggregate amount due to all participants under the Plans, the Payment Schedule and this Trust Agreement in any two-year period, and that such amount remains unpaid. If the Company or the Fiduciary determines that such a failure has occurred, then it shall so notify the participants in writing within the same 15-day period. Within a period of 20 days after receipt of such notice from the Trustee, the Company shall have failed to prove by clear and convincing evidence, in the sole and absolute discretion of the Trustee, that such amount was paid or was not due and payable. The Company shall have the responsibility to notify the Trustee of the occurrence of a Failure to Pay. If the Trustee receives notification from the Recordkeeper or the Fiduciary of a Failure to Pay, it may rely upon such notification as if it were a notification from the Company until such time, if any, as the party delivering such notification shall revoke it. |
14
[Corporate Seal] | EATON CORPORATION | |||||||||
|
||||||||||
Attest:
|
/s/ David M. OLoughlin
|
By: |
/s/ Kurt B. McMaken
|
|||||||
|
Assistant Secretary | Name: | Kurt B. McMaken | |||||||
|
Title: | Senior Vice President | ||||||||
|
Corporate Development and Treasury | |||||||||
|
||||||||||
|
By:
Name: |
/s/ Thomas E. Moran
|
||||||||
|
Title: | Senior Vice President and Secretary |
|
Address: | 1111 Superior Avenue, | ||
|
Cleveland, OH 44114 | |||
|
||||
Telephone: (216) 523-5000 | ||||
Telecopier: (216) 523-4907 |
[Corporate Seal] |
WILMINGTON TRUST RETIREMENT AND
INSTITUTIONAL SERVICES COMPANY, AS TRUSTEE |
|||||||||
|
||||||||||
Attest:
|
By: | |||||||||
|
|
|
||||||||
|
Assistant Secretary | Name: | ||||||||
|
|
|
Address: | P.O. Box 52129 | ||||
|
Phoenix, AZ 85072 | |||||
|
Attn.: | Vice President, Client Services | ||||
|
||||||
2800 North Central Avenue, Suite 900
Phoenix, AZ 85004 |
||||||
|
||||||
|
Telecopier: | (602) 955-9564 | ||||
|
Telephone: | |||||
|
|
15
16
1) | each of the undersigned have been duly appointed to their position by the Company or authorized officials of the Trust, | ||
2) | each of the undersigned individuals have the authority* to act on behalf of the Trust, | ||
3) | the Title and Signature next to his or her name is such persons Title and Signature, and | ||
4) | this Certificate supersedes all previous Incumbency Certificates on file with Wilmington Trust Retirement and Institutional Services Company with respect to the Trust. |
NAME | TITLE | SIGNATURE | ||||
Kurt B. McMaken
|
Senior Vice President Corporate Development And Treasury |
|
||||
|
|
|||||
Thomas E. Moran
|
Senior Vice President and Secretary |
|
||||
|
||||||
David M. OLoughlin
|
Assistant Secretary |
|
(SEAL)
|
|
* | If one or more of the individuals have special or limited authority regarding the Trust, please provide such limitation or special information here or on a separate sheet of paper. Otherwise, all persons listed on this Certificate have the authority to direct any action under the Agreement with Wilmington Trust Retirement and Institutional Services Company. Unless otherwise indicated, only one signature is needed. |
17
2
3
4
5
6
7
8
9
10
11
12
(i) | Any participant shall have notified the Company and the Recordkeeper in writing that the Company has failed to pay to the participant, when due, either directly or by direction to the Trustee in accordance with the terms hereof, at least 75% of any and all amounts which the participant was entitled to receive at any time in accordance with the terms of any of the Plans, the Payment Schedule or this Trust Agreement, and that such amount remains unpaid. Such notice must set forth the amount, if any, which was paid to the participant, and the amount which the participant believes he |
13
or she was entitled to receive under the Plans, the Payment Schedule and this Trust Agreement; or | |||
(ii) | More than two Plan participants shall have notified the Company and the Recordkeeper in writing, either individually or jointly, that they have not been paid, when due, amounts to which they are entitled under the Plans, the Payment Schedule or this Trust Agreement, and that such amount remains unpaid. Each such notice must set forth the amount, if any, which was paid to the participant, and the amount which the participant believes he or she was entitled to receive under the Plans, the Payment Schedule and this Trust agreement. Within 15 days after receipt of each such notice, the Company or Fiduciary shall determine, on a preliminary basis, whether any failure to pay such participants has resulted in a failure to pay when due, directly or by direction, at least 75% of the aggregate amount due to all participants under the Plans, the Payment Schedule and this Trust Agreement in any two-year period, and that such amount remains unpaid. If the Company or the Fiduciary determines that such a failure has occurred, then it shall so notify the participants in writing within the same 15-day period. Within a period of 20 days after receipt of such notice from the Trustee, the Company shall have failed to prove by clear and convincing evidence, in the sole and absolute discretion of the Trustee, that such amount was paid or was not due and payable. The Company shall have the responsibility to notify the Trustee of the occurrence of a Failure to Pay. If the Trustee receives notification from the Recordkeeper or the Fiduciary of a Failure to Pay, it may rely upon such notification as if it were a notification from the Company until such time, if any, as the party delivering such notification shall revoke it. |
14
15
16
NAME | TITLE | SIGNATURE | ||||
Kurt B. McMaken
|
Senior Vice President
Corporate
Development And Treasury |
|
||||
|
||||||
Thomas E. Moran
|
Senior Vice President and Secretary | |||||
|
|
|||||
|
||||||
David M. OLoughlin
|
Assistant Secretary | |||||
|
|
(SEAL)
|
|
* | If one or more of the individuals have special or limited authority regarding the Trust, please provide such limitation or special information here or on a separate sheet of paper. Otherwise, all persons listed on this Certificate have the authority to direct any action under the Agreement with Wilmington Trust Retirement and Institutional Services Company. Unless otherwise indicated, only one signature is needed. |
17
Year ended December 31 | ||||||||||||||||||||
(Millions of dollars) | 2010 | 2009 | 2008 | 2007 | 2006 | |||||||||||||||
Income from continuing operations
before income taxes and noncontrolling interests in consolidated subsidiaries
|
$ | 1,036 | $ | 303 | $ | 1,140 | $ | 1,055 | $ | 979 | ||||||||||
|
||||||||||||||||||||
Adjustments
|
||||||||||||||||||||
(Income) losses of equity investees
|
(14 | ) | (6 | ) | (11 | ) | (6 | ) | 1 | |||||||||||
Distributed income of equity investees
|
15 | 9 | 1 | 1 | 1 | |||||||||||||||
Interest expensed
|
162 | 170 | 192 | 193 | 139 | |||||||||||||||
Amortization of debt issue costs
|
4 | 5 | 2 | 1 | 1 | |||||||||||||||
Estimated portion of rent expense
representing interest
|
57 | 59 | 58 | 44 | 41 | |||||||||||||||
Amortization of capitalized interest
|
10 | 13 | 13 | 12 | 12 | |||||||||||||||
|
||||||||||||||||||||
Adjusted income from continuing
operations before income taxes
|
$ | 1,270 | $ | 553 | $ | 1,395 | $ | 1,300 | $ | 1,174 | ||||||||||
|
||||||||||||||||||||
|
||||||||||||||||||||
Fixed charges
|
||||||||||||||||||||
Interest expensed
|
$ | 162 | $ | 170 | $ | 192 | $ | 193 | $ | 139 | ||||||||||
Interest capitalized
|
8 | 7 | 13 | 14 | 14 | |||||||||||||||
Amortization of debt issue costs
|
4 | 5 | 2 | 1 | 1 | |||||||||||||||
Estimated portion of rent expense
representing interest
|
57 | 59 | 58 | 44 | 41 | |||||||||||||||
|
||||||||||||||||||||
Total fixed charges
|
$ | 231 | $ | 241 | $ | 265 | $ | 252 | $ | 195 | ||||||||||
|
||||||||||||||||||||
|
||||||||||||||||||||
Ratio of earnings to fixed charges
|
5.50 | 2.29 | 5.26 | 5.16 | 6.02 |
Page 70
Consolidated subsidiaries (A) | Where Organized | |
Durodyne Inc.
|
Arizona | |
EMC Engineers, Inc.
|
Colorado | |
EMC Engineers Solutions Inc.
|
Colorado | |
Aeroquip International Inc.
|
Delaware | |
Eaton Asia Investments Corporation
|
Delaware | |
Eaton Aerospace LLC
|
Delaware | |
Eaton Hydraulics LLC
|
Delaware | |
Eaton International Corporation
|
Delaware | |
EIC Holding I LLC
|
Delaware | |
EIC Holding II LLC
|
Delaware | |
EIC Holding III LLC
|
Delaware | |
EIC Holding GP I
|
Delaware | |
EIC Holding GP II
|
Delaware | |
Intelligent Switchgear Organization LLC
|
Delaware | |
Vickers International Inc.
|
Delaware | |
Wright Line Holding Inc.
|
Delaware | |
Wright Line LLC
|
Delaware | |
Eaton Ann Arbor LLC
|
Michigan | |
Eaton Inoac Company
|
Michigan | |
Moeller Electric Corporation
|
Oklahoma | |
Eaton Aeroquip LLC
|
Ohio | |
Eaton Holding International LLC
|
Ohio | |
Eaton Industrial Corporation
|
Ohio | |
Eaton Leasing Corporation
|
Ohio | |
Eaton Worldwide LLC
|
Ohio | |
EIC Holding GP III
|
Ohio | |
EIC Holding GP IV
|
Ohio | |
EIC Holding IV LLC
|
Ohio | |
EIC Holding V LLC
|
Ohio | |
EIC Holding VI LLC
|
Ohio | |
CopperLogic, Inc.
|
Texas | |
Eaton Power Quality S.A.
|
Argentina | |
Eaton S.A.
|
Argentina | |
Eaton Industries Pty. Ltd.
|
Australia | |
Eaton Holding G.m.b.H.
|
Austria | |
Eaton Beteligungen G.m.b.H.
|
Austria | |
Moeller Gebaudeautomation G.m.b.H.
|
Austria | |
Moeller Holding Austria G.m.b.H.
|
Austria | |
A-VIC Limited
|
Barbados | |
Aeroquip-Vickers Assurance Ltd.
|
Barbados | |
Eaton Holding Srl
|
Barbados | |
Eaton Holding II SRL
|
Barbados | |
Eaton Components N.V.
|
Belgium | |
Eaton Electric S.A.
|
Belgium | |
Eaton Filtration BVBA
|
Belgium | |
Moeller Electric BVBA
|
Belgium | |
Aeroquip-Vickers International Inc.
|
Bermuda | |
Cambridge International Insurance Company Ltd.
|
Bermuda | |
Eaton Services Limited
|
Bermuda | |
Saturn Insurance Company Ltd.
|
Bermuda | |
Aeroquip do Brasil Ltda.
|
Brazil | |
Eaton Ltda.
|
Brazil | |
Eaton Power Solutions Ltda.
|
Brazil | |
Moeller Electric Ltda.
|
Brazil | |
Moeller Industria de Electro-Electronicos do Amazonas Ltda.
|
Brazil |
Page 71
Consolidated subsidiaries (A) | Where Organized | |
Gain Source International Limited
|
British Virgin Islands | |
Phoenixtec International Corp.
|
British Virgin Islands | |
Senyuan International Investments Limited
|
British Virgin Islands | |
Teamachieve Investments Limited
|
British Virgin Islands | |
Winner Hydraulics Ltd.
|
British Virgin Islands | |
Moeller EOOD Electric Bulgaria
|
Bulgaria | |
Aeroquip-Vickers Canada, Inc.
|
Canada | |
Arrow Hose & Tubing Inc.
|
Canada | |
CopperLogic, Ltd.
|
Canada | |
Eaton ETN Offshore Company
|
Canada | |
Eaton ETN Offshore II Company
|
Canada | |
Eaton Power Quality Company
|
Canada | |
Eaton Yale Company
|
Canada | |
Moeller Canada Ltd.
|
Canada | |
Aeroquip Financial Ltd.
|
Cayman Islands | |
Cutler-Hammer Electrical Company
|
Cayman Islands | |
Cutler-Hammer Industries Ltd.
|
Cayman Islands | |
Eaton Holding I Limited
|
Cayman Islands | |
Eaton Holding II Limited
|
Cayman Islands | |
Eaton Holding III Limited
|
Cayman Islands | |
Georgetown Financial Services Ltd.
|
Cayman Islands | |
Green Holding Company
|
Cayman Islands | |
Senyuan International Holdings Limited
|
Cayman Islands | |
Eaton Industries (Chile) S.p.A.
|
Chile | |
Changzhou Eaton Senyuan Switch Co. Ltd.
|
China | |
Changzhou Touyan Electrical & Equipment Co., Ltd.
|
China | |
Chloride Phoenixtec Electronics (Shenzhen) Ltd.
|
China | |
Eaton (China) Investments Co., Ltd.
|
China | |
Eaton Electrical Ltd.
|
China | |
Eaton Electrical (Zhongshan) Co.,Ltd
|
China | |
Eaton Filtration (Shanghai) Co. Ltd.
|
China | |
Eaton Fluid Conveyance (Luzhou) Co. Ltd.
|
China | |
Eaton Fluid Power (Shanghai) Co. Ltd.
|
China | |
Eaton Hydraulics Systems (Jining) Co. Ltd.
|
China | |
Eaton Industries (Jining) Co., Ltd
|
China | |
Eaton Industries (Shanghai) Co. Ltd.
|
China | |
Eaton Industries (Wuxi) Co. Ltd.
|
China | |
Eaton Industrial Clutches and Brakes (Shanghai) Co., Ltd.
|
China | |
Eaton (Ningbo) Fluid Conveyance Co., Ltd.
|
China | |
Eaton Power Quality (Shanghai) Co., Ltd.
|
China | |
Eaton Senstar Automotive Fluid Connectors (Shanghai) Co. Ltd.
|
China | |
Hangzhou Eaton Power Quality Co., Ltd.
|
China | |
Lian Zheng Electronics (Shenzhen) Co. Ltd.
|
China | |
Moeller Electrical Equipment (Suzhou) Co. Ltd.
|
China | |
Moeller Electric Shanghai Co. Ltd.
|
China | |
Nanjing Xinyijia Electrical Ltd.
|
China | |
Phoenixtec Electronics (Shenzhen) Co. Ltd.
|
China | |
Santek Electronics (Shenzhen) Co. Ltd.
|
China | |
Shanghai Eaton Engine Components Company, Ltd.
|
China | |
UPE Electronics (Shenzen) Co. Ltd.
|
China | |
Zhenjiang Daqo Eaton Electrical Systems Company Limited
|
China | |
Eaton Electrical S.A.
|
Costa Rica | |
Eaton Electric S.r.o.
|
Czech Republic | |
Eaton Industries S.r.o.
|
Czech Republic | |
Moeller Elektrotechnika S.r.o.
|
Czech Republic | |
Eaton Electric ApS
|
Denmark | |
Cutler-Hammer, S. A.
|
Dominican Republic | |
Eaton Holec, OY
|
Finland | |
Eaton Power Quality Oy (Finland)
|
Finland | |
Eaton Aviation S.A.S.
|
France | |
Eaton Electric S.A.S.
|
France | |
Eaton Electric Sales S.A.S.
|
France | |
Eaton Filtration S.A.S.
|
France | |
Eaton Power Quality Holding S.A.S.
|
France | |
Eaton Power Quality S.A.S.
|
France |
Page 72
Consolidated subsidiaries (A) | Where Organized | |
Eaton Power Solutions S.A.S.
|
France | |
Eaton S.A.S.
|
France | |
Eaton Technologies S.A.
|
France | |
Eaton Automation G.m.b.H.
|
Germany | |
Eaton Automotive G.m.b.H.
|
Germany | |
Eaton Filtration G.m.b.H.
|
Germany | |
Eaton Filtration Holdings G.m.b.H.
|
Germany | |
Eaton Filtration Service G.m.b.H.
|
Germany | |
Eaton Fluid Connectors G.m.b.H.
|
Germany | |
Eaton Fluid Power G.m.b.H.
|
Germany | |
Eaton Holding G.m.b.H.
|
Germany | |
Eaton Holding II G.m.b.H. and Co. KG
|
Germany | |
Eaton Holding Investments G.m.b.H. & Co. KG
|
Germany | |
Eaton Industries G.m.b.H.
|
Germany | |
Eaton Industries Holding G.m.b.H.
|
Germany | |
Eaton Moeller G.m.b.H. & Co. KG
|
Germany | |
Eaton Power Quality G.m.b.H.
|
Germany | |
Eaton Production International G.m.b.H.
|
Germany | |
Institute for International Product Safety G.m.b.H.
|
Germany | |
Integrated Hydraulics G.m.b.H.
|
Germany | |
Moeller Eaton Holding G.m.b.H.
|
Germany | |
Eaton Electric G.m.b.H.
|
Germany | |
Eaton Power Quality Limited
|
Hong Kong | |
Riseson International Limited
|
Hong Kong | |
Santek Electronics Company Limited
|
Hong Kong | |
Scoremax Limited
|
Hong Kong | |
Smartwish International Enterprise Limited
|
Hong Kong | |
Tai Ah Electrical Ltd.
|
Hong Kong | |
Team Billion Investment Limited
|
Hong Kong | |
Vickers Systems Limited
|
Hong Kong | |
Eaton Industries Kft
|
Hungary | |
Eaton Fluid Power Limited
|
India | |
Eaton Industrial Systems Private Limited
|
India | |
Eaton Industries Private Limited
|
India | |
Eaton Power Quality Private Limited
|
India | |
Eaton Technologies Private Limited
|
India | |
Moeller HPL India Private Ltd.
|
India | |
PT. Fluid Sciences Batam
|
Indonesia | |
TT (Ireland) Acquisition Limited
|
Ireland | |
Tractech Industries (Ireland) Limited
|
Ireland | |
Tractech (Ireland) Limited
|
Ireland | |
Eaton Electric S.r.l.
|
Italy | |
Eaton Fluid Power S.r.l.
|
Italy | |
Eaton S.r.l.
|
Italy | |
Eaton Filtration Ltd.
|
Japan | |
Eaton Fluid Power Ltd.
|
Japan | |
Eaton Japan Co., Ltd.
|
Japan | |
Moeller Electric Ltd.
|
Japan | |
SEH Engineering and Service Co. Ltd.
|
Japan | |
Moeller Electric SIA
|
Latvia | |
Eaton Holding S.a r.l.
|
Luxembourg | |
Eaton Holding II S.a.r.l.
|
Luxembourg | |
Eaton Holding III S.a.r.l.
|
Luxembourg | |
Eaton Holding IV S.a.r.l.
|
Luxembourg | |
Eaton Holding V S.a.r.l.
|
Luxembourg | |
Eaton Holding VI S.a.r.l.
|
Luxembourg | |
Eaton Holding VIII S.a.r.l.
|
Luxembourg | |
Eaton Holding X S.a.r.l.
|
Luxembourg | |
Eaton Holding XI S.a.r.l.
|
Luxembourg | |
Eaton Moeller S.a.r.l.
|
Luxembourg | |
Moeller Electric SA
|
Luxembourg | |
Eaton Industries Sdn. Bhd.
|
Malaysia | |
ETN Asia International Limited
|
Mauritius | |
ETN Holding 1 Limited
|
Mauritius | |
ETN Holding 2 Limited
|
Mauritius |
Page 73
Consolidated subsidiaries (A) | Where Organized | |
ETN Holding 3 Limited
|
Mauritius | |
Eaton Controls, S. de R.L. de C.V.
|
Mexico | |
Eaton Industries, S. de R.L. de C.V.
|
Mexico | |
Eaton Technologies, S. de R.L. de C.V.
|
Mexico | |
Eaton Trading Company, S. de R.L. de C.V.
|
Mexico | |
Eaton Truck Components, S. de R.L. de C.V.
|
Mexico | |
Eaton Electric S.a.r.l.
|
Morocco | |
Eaton B.V.
|
Netherlands | |
Eaton C.V.
|
Netherlands | |
Eaton Electric B.V.
|
Netherlands | |
Eaton Holding B.V.
|
Netherlands | |
Eaton Holding I B.V.
|
Netherlands | |
Eaton Holding II B.V.
|
Netherlands | |
Eaton Holding III B.V.
|
Netherlands | |
Eaton Holding IV B.V.
|
Netherlands | |
Eaton Holding V B.V.
|
Netherlands | |
Eaton Holding VI B.V.
|
Netherlands | |
Eaton Holding VII B.V.
|
Netherlands | |
Eaton Holding International II B.V.
|
Netherlands | |
Eaton Industries B.V.
|
Netherlands | |
Eaton International B.V.
|
Netherlands | |
Eaton Moeller B.V.
|
Netherlands | |
Moeller Electric B.V.
|
Netherlands | |
Eaton Finance N.V.
|
Netherlands Antilles | |
Eaton Industries Company
|
New Zealand | |
Moeller Electric AS
|
Norway | |
Eaton Automotive Components Sp. z.o.o.
|
Poland | |
Eaton Automotive Spolka z o.o.
|
Poland | |
Eaton Automotive Systems Sp. z o.o.
|
Poland | |
Eaton Electric Sp. Z.o.o.
|
Poland | |
Eaton Electric Spolka z.o.o.
|
Poland | |
Eaton Truck Components Spolka z o.o.
|
Poland | |
Eaton Madeira SGPS Lda.
|
Portugal | |
Eaton Electro Prodictie SRL
|
Romania | |
Moeller Electric SRL
|
Romania | |
Eaton LLC
|
Russia | |
OOO Moeller Elektrik Produktion
|
Russia | |
Eaton LP
|
Scotland | |
Eaton II LP
|
Scotland | |
Eaton III LP
|
Scotland | |
Eaton IV LP
|
Scotland | |
Eaton Industries LP
|
Scotland | |
Moeller Electric d.o.o. Serbia
|
Serbia | |
Eaton Industries Pte. Ltd.
|
Singapore | |
Moeller Electric Pte. Ltd.
|
Singapore | |
Phoenixtec (Singapore) Co. Pte. Ltd.
|
Singapore | |
Eaton Electric Solutions s.r.o.
|
Slovak Republic | |
Eaton Electric s.r.o.
|
Slovak Republic | |
Eaton Filtration Co. Ltd.
|
South Africa | |
Eaton Hydraulics (Proprietary) Limited
|
South Africa | |
Eaton Truck Components (Proprietary) Limited
|
South Africa | |
Eaton Automotive Controls Limited
|
South Korea | |
Eaton Limited
|
South Korea | |
Aeroquip Iberica S.L.
|
Spain | |
Eaton Electric S.L.U.
|
Spain | |
Eaton Power Quality S.L.
|
Spain | |
Eaton S.L.
|
Spain | |
Productos Eaton Livia S.L.
|
Spain | |
Eaton Holec AB
|
Sweden | |
Eaton Power Quality AB
|
Sweden | |
Ultronics Nordic Sales AB
|
Sweden | |
Eaton Industries Manufacturing G.m.b.H.
|
Switzerland | |
Eaton Manufacturing G.m.b.H
|
Switzerland | |
Eaton Manufacturing II G.m.b.H.
|
Switzerland | |
Eaton Manufacturing III G.m.b.H.
|
Switzerland |
Page 74
Consolidated subsidiaries (A) | Where Organized | |
Micro Innovation Holding AG
|
Switzerland | |
Moeller Electric G.m.b.H.
|
Switzerland | |
Centralion Industrial Inc.
|
Taiwan | |
Eaton Phoenixtec MMPL Co.,Ltd.
|
Taiwan | |
Eaton Industries (Thailand) Ltd.
|
Thailand | |
Eaton Electric Company Ltd.
|
Thailand | |
Moeller Electric Ltd.
|
Thailand | |
Eaton Electric Ticaret Ltd. Sirket
|
Turkey | |
D.P. Eaton Electric
|
Ukraine | |
Aphel Limited
|
United Kingdom | |
Aphel Technologies Limited
|
United Kingdom | |
Eaton Aerospace Limited
|
United Kingdom | |
Eaton Electric Limited
|
United Kingdom | |
Eaton Filtration Limited
|
United Kingdom | |
Eaton Holding Limited
|
United Kingdom | |
Eaton Holding II Limited
|
United Kingdom | |
Eaton Industries Limited
|
United Kingdom | |
Eaton Limited
|
United Kingdom | |
Eaton Power Quality Limited
|
United Kingdom | |
Eaton Power Solutions Limited
|
United Kingdom | |
Integ Holdings Limited
|
United Kingdom | |
Integrated Hydraulics Limited
|
United Kingdom | |
Eaton Electric Sales Limited
|
United Kingdom | |
Moeller Holding Limited
|
United Kingdom | |
Ultronics Limited
|
United Kingdom | |
Eaton Electrical, S.A.
|
Venezuela |
(A) | Other Eaton subsidiaries, many inactive, are not listed above. If considered in the aggregate, they would not be material. |
Page 75
Registration | ||||
Number | Description | Filing Date | ||
|
||||
333-166331
|
Eaton Personal Investment Plan Form S-8 Registration Statement 300,000 Shares | April 28, 2010 | ||
|
||||
333-166330
|
Eaton Electrical De Puerto Rico Retirement Savings Plan Form S-8 Registration Statement 90,000 Shares | April 28, 2010 | ||
|
||||
333-157597
|
Eaton Corporation Shareholder Dividend Reinvestment and Direct Share Purchase Plan 1,000,000 Shares -Prospectus | August 20, 2009 | ||
|
||||
333-161002
|
Eaton Corporation 2009 Stock Plan Form S-8 Registration Statement 9,600,000 Shares | August 4, 2009 | ||
|
||||
333-158822
|
Eaton Electrical de Puerto Rico Retirement Savings Plan 90,000 shares | April 27, 2009 | ||
|
||||
333-158821
|
Eaton Incentive Compensation Deferral Plan II Form S-8 Registration Statement 250,000 Shares | April 27, 2009 | ||
|
||||
333-158820
|
Eaton Savings Plan Form S-8 Registration Statement 10,000,000 Shares | April 27, 2009 | ||
|
||||
333-158818
|
2005 Non-Employee Director Fee Deferral Plan Form S-8 Registration Statement 30,000 Shares | April 27, 2009 | ||
|
||||
333-157597
|
Eaton Corporation Form S-3 Automatic Shelf Registration Statement | February 27, 2009 | ||
|
||||
333-152763
|
Eaton Corporation 2008 Stock Plan Form S-8 Registration Statement 2,700,000 Shares | August 5, 2008 | ||
|
||||
333-150637
|
Eaton Personal Investment Plan 375,000 shares | May 5, 2008 | ||
|
||||
333-136291
|
Eaton Corporation Shareholder Dividend Reinvestment and Direct Share Purchase Plan 1,000,000 Shares -Prospectus | August 4, 2006 | ||
|
||||
333-124129
|
Eaton Corporation Incentive Compensation Deferral Plan II Form S-8 Registration Statement 400,000 Shares | April 18, 2005 | ||
|
||||
333-124128
|
Eaton Corporation Deferred Incentive Compensation Plan II Form S-8 Registration Statement 750,000 Shares | April 18, 2005 | ||
|
||||
333-124127
|
2005 Non-Employee Director Fee Deferral Plan Form S-8 Registration Statement 30,000 Shares | April 18, 2005 | ||
|
||||
333-116970
|
Eaton Corporation 2004 Stock Plan Form S-8 Registration Statement 7,000,000 Shares | June 29, 2004 | ||
|
||||
333-104366
|
1996 Non-Employee Director Fee Deferral Plan Form S-8 Registration Statement 30,000 Shares | April 8, 2003 |
Page 76
Registration | ||||
Number | Description | Filing Date | ||
|
||||
333-97371
|
Eaton Corporation 2002 Stock Plan Form S-8 Registration Statement | July 30, 2002 | ||
|
||||
333-86389
|
Eaton Corporation Executive Strategic Incentive Plan Form S-8 Registration Statement | September 2, 1999 | ||
|
||||
333-62373
|
Eaton Holding Limited U.K. Savings Related Share Option Scheme [1998] Form S-8 Registration Statement | August 27, 1998 |
/s/ Ernst & Young LLP
|
||
February 25, 2011
|
Page 77
/s/ Alexander M. Cutler
|
/s/ Richard H. Fearon | |||
|
|
|||
and Chief Executive Officer;
President; Principal Executive Officer; Director |
Vice Chairman and
Chief Financial and Planning Officer; Principal Financial Officer |
|||
|
||||
/s/ Billie K. Rawot
|
||||
|
||||
Senior Vice President and Controller;
|
||||
Principal Accounting Officer
|
||||
|
||||
/s/ Todd M. Bluedorn
|
/s/ Christopher M. Connor | |||
|
|
|||
|
||||
/s/ Michael J. Critelli
|
/s/ Charles E. Golden | |||
|
|
|||
|
||||
/s/ Ernie Green
|
/s/ Arthur E. Johnson | |||
|
|
|||
|
||||
/s/ Ned C. Lautenbach
|
/s/ Deborah L. McCoy | |||
|
|
|||
|
||||
/s/ Gregory R. Page
|
/s/ Gary L. Tooker
|
|||
|
|
Page 78
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: February 25, 2011 | /s/ Alexander M. Cutler | |||
Alexander M. Cutler | ||||
Chairman and Chief Executive Officer; President | ||||
Page 79
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: February 25, 2011 | /s/ Richard H. Fearon | |||
Richard H. Fearon | ||||
Vice Chairman and Chief Financial
and Planning Officer |
||||
Page 80
Date: February 25, 2011 | /s/ Alexander M. Cutler | |||
Alexander M. Cutler | ||||
Chairman and Chief Executive Officer; President | ||||
Page 81
Date: February 25, 2011 | /s/ Richard H. Fearon | |||
Richard H. Fearon | ||||
Vice Chairman and Chief Financial
and Planning Officer |
||||
Page 82