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SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 11-K
 Annual Report Pursuant to Section 15(d) of the 
Securities Exchange Act of 1934
 þ
    
    Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934
 For the fiscal year ended December 31, 2010
 Or
 o
    
    Transition report pursuant to Section 15(d) of the Securities Exchange Act of 1934
 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 Electrical de Puerto Rico, Inc.
Retirement Savings Plan
 B.
    
    Name of issuer of the securities held pursuant to the plan and the address of its
principal executive office:
 
 SIGNATURES
  (Name of Plan)
EATON ELECTRICAL DE PUERTO RICO, INC.
RETIREMENT SAVINGS PLANDate: June 22, 2011
    By:
    Eaton Corporation PensionAdministration CommitteeBy:
    /s/ B. K. RawotB. K. RawotSenior Vice President and Controller
Eaton Corporation




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INDEX
 PageReport of Independent Registered Public Accounting FirmFinancial Statements:Statement of Net Assets Available for Benefits
    
    
    2Statement of Changes in Net Assets Available for Benefits
    
    
    3Notes to Financial Statements
    
    
    4 - 12Supplemental Schedule:Schedule of Assets Held for Investment Purposes at End of Year
    
    
    13




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




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December 312010
    
    
    2009ASSETSReceivable  Employer contributions
    
    $
    15,868
    
    
    $
    Receivable  Employee contributions
    
    
    40,242
    
    
    
    31,114Total Receivables
    
    
    56,110
    
    
    
    31,114Investments:Vanguard Retirement Savings Trust II
    
    
    21,020,758
    
    
    
    19,322,254Eaton Common Shares Fund
    
    
    4,676,317
    
    
    
    4,022,891Vanguard Institutional Index
    
    
    2,472,409
    
    
    
    2,202,553Vanguard Balanced Index Fund
    
    
    849,840
    
    
    
    786,508Vanguard Developed Markets Index
    
    
    565,654
    
    
    
    574,240Total Investments
    
    
    29,584,978
    
    
    
    26,908,446Net Assets Available for Benefits at Fair Value
    
    29,641,088
    
    
    26,939,560Adjustment from fair value to contract value for fully benefit-responsive investment contract
    
    
    (827,758
    )
    
    
    (417,712
    )Net Assets Available for Benefits
    
    $
    28,813,330
    
    
    $
    26,521,848
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Year Ended December 312010
    
    
    2009Additions to Net Assets Attributed to:Contributions:Employer
    
    $
    301,346
    
    
    $
    194,993Employee
    
    
    1,463,353
    
    
    
    1,399,4501,764,699
    
    
    
    1,594,443Interest and dividend income
    
    
    791,883
    
    
    
    808,528Net unrealized/realized appreciation
    
    
    2,452,802
    
    
    
    1,478,132Total Additions
    
    
    5,009,384
    
    
    
    3,881,103Deductions from Net Assets Attributed to:Benefits paid to participants
    
    
    2,717,770
    
    
    
    4,409,261Administrative Expenses
    
    
    132
    
    
    
    152Total Deductions
    
    
    2,717,902
    
    
    
    4,409,413Net Increase/(Decrease)
    
    
    2,291,482
    
    
    
    (528,310
    )Net Assets Available for Benefits:Beginning of Year
    
    
    26,521,848
    
    
    
    27,050,158End of Year
    
    $
    28,813,330
    
    
    $
    26,521,848
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1
    
    Description of Plan
 The following description of The Eaton Electrical de Puerto Rico, Inc. Retirement Savings
Plan (the Plan) provides only general information. Participants should refer to the Plan
document and summary plan description, which is available from the Human Resources Department
upon request, for a complete description of the Plans provisions.General:Effective February 1, 1994, Eaton Electrical de Puerto Rico, Inc. (the Company), which was
formerly known as Cutler-Hammer de Puerto Rico, Inc., a wholly owned subsidiary of Eaton
Corporation, established the Plan. Effective January 1, 2009, the Plan Sponsor is Cutler
Hammer Electrical Company. The plan was amended and restated at the close of business
December 31, 2010. As of January 1, 2011, the plan is named The Puerto Rico Retirement
Savings Plan and Banco Popular is appointed the sole trustee of the plan.Eligibility:The Plan provides that all full-time employees not covered under a collective bargaining
agreement of the Company are eligible to participate in the Plan immediately upon employment.Effective April 1, 2011, newly hired employees will be automatically enrolled in the Plan.Contributions:Employee Contributions  Effective January 1, 2009, employees may elect to make before-tax
contributions to the Plan up to a maximum of 30% of their compensation.Employer Contributions  The Company has agreed to make a voluntarily matching contribution
of 50% of the employee contributions not to exceed 3% of the total compensation of the
employee. Effective with the first full pay period beginning after May 1, 2009, the matching
contribution was suspended. The Company matching contribution was reinstated effective July
1, 2010.Contributions are subject to limitations on annual additions and other limitations imposed by
Section 1165(e) of the Puerto Rico Internal Revenue Code, as amended from time to time, as
defined in the Plan agreement.
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1
    
    Description of Plan, Continued
 Participants Accounts:Each participants account is credited with the participants contributions and allocations
of Company contributions, Plan earnings and transaction costs. Allocations are based on
participant earnings or account balances, as defined. The benefit to which a participant is
entitled is the benefit that can be provided from the participants account. On termination
of service, a participant is eligible to receive a lump-sum amount equal to the vested value
of his or her account.Vesting:All participants are 100% vested in their contributions plus actual earnings thereon. Vesting
in the Company contribution portion of their accounts plus actual earnings thereon is based
on years of continuous service. Participants are 100% vested after three years of credited
service or upon the death of the participant.Forfeitures:Forfeited non-vested accounts totaled $21 and $11,965 as of December 31, 2010 and 2009,
respectively. Future employer contributions will be reduced by these amounts.Hardship Withdrawals:Hardship withdrawals are permitted in accordance with Internal Revenue Service guidelines.Investment Options:Contributions may be invested in any of the fund options available under the Plan.
 2
    
    Summary of Significant Accounting Policies
 Basis of Accounting:The financial statements of the Plan are prepared under the accrual method of accounting.
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2
    
    Summary of Significant Accounting Policies, Continued
 Investment Valuation and Income Recognition:Securities traded on a national securities exchange are valued at the last reported sales
price on the last business day of the Plan year. The Vanguard Retirement Savings Trust II
Fund invests primarily in investment contracts issued by insurance companies, banks or other
financial institutions, including investment contracts backed by high-quality fixed income
securities.Purchases and sales of securities are recorded on a trade-date basis. Dividends are recorded
on the ex-dividend date.Under the revised accounting standards, investment contracts held by a defined-contribution
plan are required to be reported at fair value. However, contract value is the relevant
measurement attribute for that portion of the net assets available for benefits of a
defined-contribution plan attributable to fully benefit-responsive investment contracts
because contract value is the amount participants would receive if they were to initiate
permitted transactions under the terms of the Plan. The Statement of Net Assets Available for
Benefits presents the fair value of the investment contracts as well as the adjustment of the
fully benefit-responsive investment contracts from fair value to contract value. The
Statement of Changes in Net Assets Available for Benefits is prepared on a contract value
basis.Use of Estimates:The preparation of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenue and expenses during the
reporting period. Actual results could differ from those estimates.Administrative Fees:Substantially all administrative, management fees and other expenses of the Plan are paid by
the Company. Certain transaction costs are paid by the participants.Plan Termination:The Company may amend, modify, suspend or terminate the Plan, provided that no assets held by
the Plan or income thereon received for the purposes of the Plan shall be used for, or
diverted to, purposes other than for the exclusive benefit of participating employees or
their beneficiaries.
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2
    
    Summary of Significant Accounting Policies, Continued
 Risks and Uncertainties:The Plans investment include investments in mutual funds and a collective fund holding
investment contracts with varying degrees of risk, such as interest rate, credit and overall
market volatility risks. Due to the level of risk associated with certain investment
securities, it is reasonably possible that changes in the values of investment securities
will occur in the near term and such changes could materially affect the amounts reported in
the statement of net assets available for Plan benefits.Subsequent Events:Management evaluates events occurring subsequent to the date of the financial statements in
determining the accounting for and disclosure of transactions and events that affect the
financial statements.
 3
    
    Investments
 Banco Popular de Puerto Rico and Fidelity Management Trust Company are the co-trustee of the
Plan through the close of business on December 31, 2010. Investments which constitute more
than 5% of the Plans net assets are:
 2010
    
    
    2009Vanguard Retirement Savings Trust II
    
    $
    21,020,758
    
    
    $
    19,322,254Eaton Common Shares Fund (A unitized fund
of Eaton Shares and cash)
    
    $
    4,676,317
    
    
    $
    4,022,891Vanguard Institutional Index
    
    $
    2,472,409
    
    
    $
    2,202,553During 2010 and 2009, the Plans investments (including investments
purchased, sold as well as held during the year) appreciated (depreciated) in
fair value as follows:Eaton Common Shares Fund
    
    $
    2,068,261
    
    
    $
    829,992Mutual funds
    
    
    384,541
    
    
    
    648,140$
    2,452,802
    
    
    $
    1,478,132
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4
    
    Tax Status
 The Plan has received a determination letter from the Puerto Rico Treasury Department dated
August 24, 1999, stating that the Plan meets the requirements for qualification under Puerto
Rico income tax laws and that the related trust is exempt from income taxes. Subsequent to
this determination the Plan was amended. Once qualified, the Plan is required to operate in
conformity with the income tax laws of Puerto Rico to maintain its qualification. The Plan
administrator believes the Plan is being operated in compliance with the applicable
requirements of the income tax laws of Puerto Rico and, therefore, believes that the Plan, as
amended, is qualified and the related trust is tax exempt.
 5
    
    Party-in-Interest Transactions
 Party-in-interest transactions include the investment in the common stock of Eaton
Corporation, the investment in the investment funds of the trustee and the payment of
administrative expenses by the Company. Such transactions are exempt from being prohibited
transactions.During 2010 and 2009, the Plan received $124,899 and $114,620, respectively, in common stock
dividends from Eaton Corporation.
 6
    
    Benefit-Responsive Fund
 The Plan holds the Vanguard Retirement Savings Trust II, a fund managed by Vanguard, that
invests in benefit-responsive investment contracts. The fund is credited with earnings on the
underlying investments and charged for participant withdrawals and administrative expenses.
The traditional guaranteed investment contract issuers are contractually obligated to repay
the principal and a specified interest rate that is guaranteed to the Plan and the synthetic
contract issuers are contractually obligated to guarantee the payment of a specific interest
rate to the Plan.
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6
    
    Benefit-Responsive Fund
 As described in Note 2, because the guaranteed investment contract is fully
benefit-responsive, contract value is the relevant measurement attribute for that portion of
the net assets available for benefits attributable to the guaranteed investment contract.
Contract value, as reported to the Plan by Vanguard, represents contributions made under the
contract, plus earnings, less participant withdrawals and administrative expenses.
Participants may ordinarily direct the withdrawal or transfer of all or a portion of their
investment at contract value.The average market yield of the Fund for 2010 and 2009 was 3.36% and 3.15%, respectively.
This yield is calculated based on actual investment income from the underlying investments
for the last month of the year, annualized and divided by the fair value of the investment
portfolio on the report date. The average yield of the Fund with an adjustment to reflect the
actual interest rate credited to participants in the Fund was 3.01% and 2.86%, respectively.There are no reserves against contract value for credit risk of the contract issuer or
otherwise. The crediting interest rate is based on a formula agreed upon with the issuer, but
it may not be less than zero percent. Such interest rates are reviewed on a quarterly basis
for resetting.The fair value is based on various valuation approaches dependent on the underlying
investments of the contract.Certain events limit the ability of the Plan to transact at contract value with the issuer.
The Plan Administrator does not believe that the occurrence of any such value event, which
would limit the Plans ability to transact at contract value with participants is probable.
The issuer may terminate the contract for cause at any time.
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7
    
    Fair Value Measurements
 In accordance with ASC 820, the Plan categorized financial instruments, based on the degree
of subjectivity inherent in the valuation technique, into a fair value hierarchy of three
levels, as follows:
 
    
    Level 1  inputs to the valuation methodology are quoted prices (unadjusted) for identical
assets or liabilities in active markets.
    
    Level 2  inputs to the valuation methodology include quoted prices for similar assets and
liabilities in active markets, and inputs that are observable for the asset or liability,
either directly or indirectly, for substantially the full term of the financial instrument.
    
    Level 3  inputs to the valuation methodology are unobservable and significant to the fair
value measurement.
 Following is a description of the valuation methodologies used for assets measured at fair
value.There have been no changes in the methodologies used at December 31, 2010 and 2009.Registered investment companies (mutual funds) and separate accounts:Valued at the net asset
value (NAV) of shares held by the Plan at year end.Guaranteed Investment Contract: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 methods described above may produce a fair value calculation that may not be indicative
of net realizable value or reflective of future fair values. Furthermore, while the Plan
believes its valuation methods are appropriate and consistent with other market participants,
the use of different methodologies or assumptions to determine the fair value of certain
financial instruments could result in a different fair value measurement at the reporting
date.
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7
    
    Fair Value Measurements, ContinuedThe following table sets forth by level on a recurring basis, within the fair value
hierarchy, the Plans assets at fair value as of December 31, 2010:
 Level 1
    
    
    Level 2Fair Value
    
    
    Fair Value
    
    
    TotalRegistered investment companiesLarge-cap equity funds
    
    $
    2,472,409
    
    
    $
    
    
    
    $
    2,472,409Balanced funds
    
    
    849,840
    
    
    
    
    
    
    
    849,840International equity funds
    
    
    565,654
    
    
    
    
    
    
    
    565,654Total
    
    
    3,887,903
    
    
    
    
    
    
    
    3,887,903Guaranteed
investment contractsStable value funds
    
    
    
    
    
    
    21,020,758
    
    
    
    21,020,758Separate
accountsCompany stock funds
    
    
    
    
    
    
    4,676,317
    
    
    
    4,676,317Total assets at fair value
    
    $
    3,887,903
    
    
    $
    25,697,075
    
    
    $
    29,584,978
 The following table sets forth by level on a recurring basis, within the fair
value hierarchy, the Plans assets at fair value as of December 31, 2009:
 Level 1
    
    
    Level 2Fair Value
    
    
    Fair Value
    
    
    TotalRegistered investment companiesLarge-cap equity funds
    
    $
    2,202,553
    
    
    $
    
    
    
    $
    2,202,553Balanced funds
    
    
    786,508
    
    
    
    
    
    
    
    786,508International equity funds
    
    
    574,240
    
    
    
    
    
    
    
    574,240Total
    
    
    3,563,301
    
    
    
    
    
    
    
    3,563,301Guaranteed investment contractsStable value funds
    
    
    
    
    
    
    19,322,254
    
    
    
    19,322,254Separate accountsCompany stock funds
    
    
    
    
    
    
    4,022,891
    
    
    
    4,022,891Total assets at fair value
    
    $
    3,563,301
    
    
    $
    23,345,145
    
    
    $
    26,908,446
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8
    
    Recent Accounting Pronouncements
 In January 2010, the FASB issued an accounting standard update titled Fair Value
Measurements and Disclosures (Topic 820), Improving Disclosures about Fair Value
Measurements. This new guidance requires additional disclosures to be provided, including:
1) transfers in and out of Levels 1 and 2 and the reasons for the transfers, 2) additional
breakout of asset and liability categories and 3) purchases, sales, issuances and settlements
to be reported separately in the Level 3 roll forward. This guidance was effective for
periods beginning after December 15, 2009, except for the item related to the Level 3 roll
forward which is effective for periods beginning after December 15, 2010 and interim periods
within those years. This guidance was effective for the Company for the year ended December
31, 2010. The adoption did not have a material impact on the Plan.
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(b)
    
    (c)Identity of Issue,
    
    Description of Investment Including
    
    
    
    (e)Borrower, Lessor,
    
    Maturity Date, Rate of Interest,
    
    (d)
    
    Current(a)
    
    or Similar Party
    
    Collateral, Par or Maturity Value
    
    Cost
    
    ValueVanguard Retirement Savings Trust II - see Footnote 1
    
    Guaranteed Investment Contract
    
    N/A
    
    $
    20,193,000*
    
    Eaton Common Shares Fund
    
    Separate accounts
    
    N/A
    
    
    4,676,317Vanguard Institutional Index
    
    Mutual Funds
    
    N/A
    
    
    2,472,409Vanguard Balanced Index Fund
    
    Mutual Funds
    
    N/A
    
    
    849,840Vanguard Developed Markets Index
    
    Mutual Funds
    
    N/A
    
    
    565,654$
    28,757,220
 
 Footnote 1 - denotes contract value*
    
    Party-in-interest to the Plan.
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Consent of Independent Registered Public Accounting Firm