Eaton Increases Dividend 15 Percent to $.31 Per Share

CLEVELAND--Jan. 2, 20054, 2005--As announced in today's fourth quarter 2004 earnings news release, the Board of Directors of diversified industrial manufacturer Eaton Corporation has declared a first quarter dividend of $.31 per share, representing a 15 percent increase over the previous quarterly dividend of $.27 per share.

The dividend is payable on February 25, 2005 to shareholders of record at the close of business on February 7, 2005. Eaton has paid dividends on common shares every year since 1923.

Eaton Corporation is a diversified industrial manufacturer with 2004 sales of $9.8 billion. Eaton is a global leader in fluid power systems and services for industrial, mobile and aircraft equipment; electrical systems and components for power quality, distribution and control; automotive engine air management systems, powertrain solutions and specialty controls for performance, fuel economy and safety; and intelligent truck drivetrain systems for safety and fuel economy. Eaton has 55,000 employees and sells products to customers in more than 125 countries. For more information, visit www.eaton.com.