Filed Pursuant to Rule 424(b)(2)
Registration No. 333-57386
PROSPECTUS SUPPLEMENT
MARCH 14, 2002
(TO PROSPECTUS DATED APRIL 2, 2001)
$500,000,000
[LOGO]
6.375% NOTES DUE APRIL 1, 2012
----------------
Praxair, Inc. will pay interest on the notes on April 1 and October 1 of
each year beginning October 1, 2002. We may redeem some or all of the notes at
any time and from time to time by paying the greater of principal and accrued
interest on the notes or a "Make-Whole Amount." There is no sinking fund for the
notes. We will issue the notes only in denominations of $1,000 and integral
multiples of $1,000.
------------------------
Per Note Total
-------- ------------
Price to Public 99.551% $497,755,000
Underwriting Discounts and Commissions 0.650% $ 3,250,000
Proceeds to Praxair(1) 98.901% $494,505,000
------------------------
(1) Before deducting expenses payable by us estimated at $250,000.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus supplement or the accompanying prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
The notes will be ready for delivery in book-entry form only through The
Depository Trust Company on or about March 19, 2002.
------------------------
JOINT BOOK-RUNNING MANAGERS
Banc of America Securities LLC Deutsche Banc Alex. Brown
----------------
ABN AMRO Incorporated
Commerzbank Capital Markets Corp.
Credit Suisse First Boston
Fleet Securities, Inc.
JPMorgan
Lehman Brothers
Merrill Lynch & Co
Morgan Stanley
Salomon Smith Barney
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PAGE
--------
Where You Can Find More Information......................... S-2
Note Regarding Forward-Looking Statements................... S-2
The Company................................................. S-2
Use of Proceeds............................................. S-3
Ratios of Earnings to Fixed Charges......................... S-3
Description of the Notes.................................... S-3
Underwriting................................................ S-5
Experts..................................................... S-6
PROSPECTUS
PAGE
--------
About This Prospectus....................................... 3
Incorporation of Certain Documents by Reference............. 3
Note Regarding Forward-Looking Statements................... 4
The Company................................................. 4
Use of Proceeds............................................. 5
Ratios of Earnings To Fixed Charges and Earnings To Combined
Fixed Charges and Preferred Stock Dividends............... 5
Description of Capital Stock................................ 6
Description of Debt Securities.............................. 10
Plan of Distribution........................................ 22
Legal Matters............................................... 23
Experts..................................................... 23
------------------------
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. WE HAVE
NOT, AND THE UNDERWRITERS HAVE NOT, AUTHORIZED ANY OTHER PERSON TO PROVIDE YOU
WITH DIFFERENT INFORMATION. IF ANYONE PROVIDES YOU WITH DIFFERENT OR
INCONSISTENT INFORMATION, YOU SHOULD NOT RELY ON IT. WE ARE NOT, AND THE
UNDERWRITERS ARE NOT, MAKING AN OFFER TO SELL THESE SECURITIES IN ANY
JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. YOU SHOULD ASSUME THAT
THE INFORMATION APPEARING IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING
PROSPECTUS IS ACCURATE AS OF THE DATE ON THE FRONT OF THIS PROSPECTUS SUPPLEMENT
ONLY. OUR BUSINESS, FINANCIAL CONDITION, RESULTS OF OPERATIONS AND PROSPECTS MAY
HAVE CHANGED SINCE THAT DATE.
References to "we", "us" and "our" are to Praxair, Inc. and its subsidiaries
unless the context otherwise requires.
S-1
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at HTTP://WWW.SEC.GOV. You may also read and copy
any document we file at the SEC's public reference rooms in Washington, D.C.,
New York, and Chicago, as well as at the offices of the New York Stock Exchange,
20 Broad Street, New York, New York, 10005, where our common stock is listed
under the symbol "PX." You can call the SEC at 1-800-732-0330 for further
information about the public reference rooms.
The SEC allows us to "incorporate by reference" the information we file with
them, which means we are assumed to have disclosed important information to you
when we refer you to documents that are on file with the SEC. The information we
have incorporated by reference is an important part of this prospectus, and
information that we file later with the SEC will automatically update and
supersede this information. We incorporate by reference the documents listed
below and any future documents we file with the SEC under Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934 until we sell all of the
securities covered by this prospectus supplement and the accompanying
prospectus.
- Annual Report on Form 10-K for the fiscal year ended December 31, 2001.
You may request a copy of these documents at no cost by writing to us at the
following address:
Praxair, Inc.
39 Old Ridgebury Road
Danbury, Connecticut 06810-5113
Attn: Assistant Corporate Secretary
Telephone: (203) 837-2000.
NOTE REGARDING FORWARD-LOOKING STATEMENTS
The forward-looking statements contained in this prospectus supplement and
the accompanying prospectus concerning demand for products and services, the
expected macroeconomic environment, sales and earnings growth, projected capital
and acquisition spending, the impact of required changes in accounting, and
other financial goals involve risks and uncertainties, and are subject to change
based on various factors. These risk factors include the impact of changes in
worldwide and national economies, the cost and availability of electric power,
natural gas and other materials, development of operational efficiencies,
changes in foreign currencies, changes in interest rates, the continued timely
development and acceptance of new products and services, the impact of
competitive products and pricing, and the impact of tax and other legislation
and regulation in the jurisdictions in which the company operates as well as new
accounting rules and practices.
Although we believe that the expectations reflected in the forward-looking
statements are responsible, we cannot guarantee future results, levels of
activity, performance or achievements. Moreover, neither we nor any other person
assumes responsibility for the accuracy and completeness of these
forward-looking statements. We are under no duty and do not intend to update any
of the forward-looking statements after the date of this prospectus supplement
or to conform our prior statements to actual results.
THE COMPANY
Praxair was the first company in the United States to produce oxygen from
air using a cryogenic process. We have been, and continue to be, a major
technological innovator in the industrial gases industry and have done much to
create value for our customers by developing new applications for industrial
gases and to open new markets by lowering the cost of supply.
S-2
Praxair is the largest industrial gases company in North and South America
and the third largest worldwide. We are also the world's largest supplier of
carbon dioxide. Our primary products for our industrial gases business are
atmospheric gases (oxygen, nitrogen, argon, rare gases), process gases (carbon
dioxide, helium, hydrogen, electronic gases, specialty gases, acetylene), and we
also design, engineer and build equipment that produces industrial gases (for
internal use and external sale). Our surface technology segment, operated
through Praxair Surface Technologies, Inc., supplies wear-resistant and
high-temperature corrosion-resistant metallic and ceramic coatings and powders.
Our sales were $5,158 million, $5,043 million and $4,639 million for 2001, 2000
and 1999, respectively, with industrial gases and related products and services
accounting for 92% of sales in 2001, 2000 and 1999, and surface technologies
accounting for the balance.
Gases produced by us find wide use in the aerospace, chemicals, electronics,
energy, food & beverage, healthcare, manufacturing and metals industries. By
using the gases that we produce and, in many cases, the proprietary processes
that we invent, customer value is created through improved product quality,
increased productivity, conservation of energy, and the attainment of
environmental improvement objectives. We have been and continue to be a major
technological innovator in the industrial gases industry and, working with
customers, have done much to increase the use of our industrial gases to support
the manufacture of other products and for many other uses. Historically,
consumption of industrial gases has increased at approximately 1.5 to 2.0 times
local industrial production growth in countries in which we do business.
We (including our predecessor companies) were founded in 1907 and were
incorporated in Delaware in 1988. Our principal offices are located at 39 Old
Ridgebury Road in Danbury, Connecticut 06810-5113 and our telephone number is
(203) 837-2000.
USE OF PROCEEDS
We will use the net proceeds from the sale of the notes of approximately
$494.3 million to repay outstanding commercial paper and other short-term
borrowings. Prior to their application, the proceeds may be invested in
short-term investments. The indebtedness to be repaid with the proceeds of this
offering was incurred for general corporate purposes. At March 13, 2002 our
outstanding commercial paper and short-term borrowing bore interest at a
weighted average interest rate of approximately 2.06% per annum and had
maturities of up to 180 days.
RATIOS OF EARNINGS TO FIXED CHARGES
Our ratios of earnings to fixed charges for the years ended December 31,
2001, 2000, 1999, 1998 and 1997 were 3.1, 2.7, 3.3, 2.8 and 3.2, respectively.
DESCRIPTION OF THE NOTES
The following description of the particular terms of the notes supplements,
and to the extent inconsistent therewith supersedes, the description of the
general terms and provisions of the senior debt securities included in the
accompanying prospectus, to which description reference is hereby made.
The notes will be our unsecured general obligations, will be issued under an
indenture dated as of July 15, 1992 between Praxair, Inc. and State Street Bank
and Trust Company, as the ultimate successor trustee to Bank of America,
Illinois, will be limited to $500,000,000 principal amount, will be issued in
book-entry form only and will mature on April 1, 2012.
The notes will bear interest from March 19, 2002 or from the most recent
date to which interest has been paid or provided for, at the rate of 6.375% per
year, payable semi-annually on April 1 and October 1 commencing on October 1,
2002 to the persons in whose names the notes are registered at
S-3
the close of business on the preceding March 15 and September 15, respectively.
The notes will accrue interest on the basis of a 360-day year consisting of
12 months of 30 days each.
We may redeem all or part of the notes at any time at our option at a
redemption price equal to the greater of (1) the principal amount of the notes
being redeemed plus accrued and unpaid interest to the redemption date or
(2) the Make-Whole Amount for the notes being redeemed.
"Make-Whole Amount," means, as determined by a Quotation Agent, the sum of
the present values of the principal amount of the notes to be redeemed, together
with the scheduled payments of interest (exclusive of interest to the redemption
date) from the redemption date to the maturity date of the notes being redeemed,
in each case discounted to the redemption date on a semi-annual basis, assuming
a 360-day year consisting of twelve 30-day months, at the Adjusted Treasury
Rate, plus accrued and unpaid interest on the principal amount of the notes
being redeemed to the redemption date.
"Adjusted Treasury Rate" means, with respect, to any redemption date, the
sum of (x) either (1) the yield, under the heading that represents the average
for the immediately preceding week, appearing in the most recent published
statistical release designated "H.15 (519)" or any successor publication that is
published weekly by the Board of Governors of the Federal Reserve System and
that establishes yields on actively traded United States Treasury securities
adjusted to the Comparable Treasury Issue (if no maturity is within three months
before or after the remaining term of the notes being redeemed, yields for the
two published maturities most closely corresponding to the Comparable Treasury
Issue shall be determined and the Adjusted Treasury Rate shall be interpolated
or extrapolated from such yields on a straight line basis, rounded to the
nearest month) or (2) if such release (or any successor release) is not
published during the week preceding the calculation date or does not contain
such yields, the rate per year equal to the semi-annual equivalent yield to
maturity of the Comparable Treasury Price for such redemption date, in each case
calculated on the third business day preceding the redemption date, and (y)
0.20%.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a maturity comparable to the remaining
term from the redemption date to the maturity date of the notes being redeemed
that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of notes.
"Comparable Treasury Price" means, with respect to any redemption date, if
clause (2) of the Adjusted Treasury Rate is applicable, the average of three, or
such lesser number as is obtained by the indenture trustee, Reference Treasury
Dealer Quotations for such redemption date.
"Quotation Agent" means the Reference Treasury Dealer selected by the
indenture trustee after consultation with us.
"Reference Treasury Dealer" means any of Banc of America Securities LLC and
Deutsche Banc Alex. Brown Inc. and their respective successors and assigns, and
one other nationally recognized investment banking firm selected by us that is a
primary U.S. Government securities dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
indenture trustee, of the bid and asked prices for the Comparable Treasury
Issue, expressed in each case as a percentage of its principal amount, quoted in
writing to the indenture trustee by such Reference Treasury Dealer at
5:00 p.m., New York City time, on the third business day preceding such
redemption date.
The notes are subject to defeasance under the conditions described in the
accompanying prospectus, including the condition that an opinion of counsel be
delivered with respect to the absence of any tax effect of any such defeasance
to holders of the notes.
S-4
Upon issuance, the notes will be represented by one or more global
securities that will be deposited with, or on behalf of, DTC and will be
registered in the name of DTC or a nominee of DTC. See "Description of Debt
Securities--Global Debt Securities" in the accompanying prospectus.
We may from time to time without the consent of the holders of the notes
create and issue further notes having the same terms and conditions as these
notes so that the further issue would be consolidated and form a single issue
with these notes.
UNDERWRITING
Under the terms and subject to the conditions set forth in an underwriting
agreement dated the date hereof, the underwriters named below for whom Banc of
America Securities LLC and Deutsche Banc Alex. Brown Inc. are acting as joint
bookrunning managers have severally agreed to purchase, and we have agreed to
sell to them, severally, the respective principal amounts of notes set forth
opposite their names below:
PRINCIPAL
UNDERWRITERS AMOUNT OF NOTES
------------ ---------------
Banc of America Securities LLC.............................. $162,520,000
Deutsche Banc Alex. Brown Inc............................... 162,520,000
ABN AMRO Incorporated....................................... 19,440,000
Commerzbank Capital Markets Corp............................ 19,440,000
Credit Suisse First Boston Corporation...................... 19,440,000
Fleet Securities, Inc....................................... 19,440,000
J.P. Morgan Securities Inc.................................. 19,440,000
Lehman Brothers Inc......................................... 19,440,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated.......... 19,440,000
Morgan Stanley & Co. Incorporated........................... 19,440,000
Salomon Smith Barney Inc.................................... 19,440,000
------------
Total..................................................... $500,000,000
============
The underwriting agreement provides that the obligation of the several
underwriters to pay for and accept delivery of the notes is subject to the
approval of certain legal matters by their counsel and to certain other
conditions. The underwriters are committed to purchase all of the notes if any
are purchased.
The underwriters propose to offer part of the notes directly to the public
at the public offering price shown on the cover page hereof and part to certain
dealers at a price that represents a concession not in excess of 0.400% of the
principal amount of the notes. The underwriters may allow, and such dealers may
reallow, a concession not in excess of 0.250% of the principal amount of the
notes to certain other dealers. After the initial offering of the notes the
offering price and other selling terms may from time to time be varied by the
underwriters.
We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act of 1933.
We do not intend to apply for listing of the notes on a national securities
exchange, but have been advised by the underwriters that they currently intend
to make a market in the notes, as permitted by applicable laws and regulations.
The underwriters are not obligated, however, to make a market in the notes and
any such market making may be discontinued at any time at the sole discretion of
the underwriters. Accordingly, no assurance can be given as to the liquidity of,
or trading market for, the notes.
S-5
In connection with the offering of the notes, the underwriters may engage in
transactions that stabilize, maintain or otherwise affect the price of the
notes. Specifically, the underwriters may overallot in connection with the
offering of the notes, creating a syndicate short position. In addition, the
underwriters may bid for, and purchase notes in the open market to cover
syndicate short positions or to stabilize the price of the notes. Finally, the
underwriting syndicate may reclaim selling concessions allowed for distributing
the notes in the offering of the notes, if the syndicate repurchases previously
distributed notes in syndicate covering transactions, stabilization transactions
or otherwise. Any of these activities may stabilize or maintain the market price
of the notes above independent market levels. The underwriters are not required
to engage in any of these activities, and may end any of them at any time.
In the ordinary course of their respective businesses, the underwriters and
their affiliates have engaged, are engaging and may in the future engage, in
commercial banking and/or investment banking transactions with us and our
affiliates.
EXPERTS
The consolidated financial statements incorporated in this Prospectus
Supplement by reference to the Annual Report on Form 10-K of Praxair, Inc. for
the year ended December 31, 2001 have been so incorporated in reliance on the
report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
S-6
PROSPECTUS
$1,125,000,000
PRAXAIR, INC.
COMMON STOCK
PREFERRED STOCK
AND
DEBT SECURITIES
We may offer, from time to time, in one or more series:
- shares of our common stock;
- shares of our preferred stock;
- unsecured senior debt securities; and
- unsecured subordinated debt securities.
The securities:
- will have a maximum aggregate offering price of $1,125,000,000;
- will be offered at prices and on terms to be set forth in one or more
prospectus supplements;
- may be denominated in U.S. dollars or in other currencies or currency
units;
- may be offered separately or together with other securities as units,
or in separate series; and
- may be listed on a national securities exchange, if specified in the
applicable prospectus supplement.
The aggregate initial offering price of all securities sold under this
prospectus will not exceed $1,125,000,000.
Our common stock is listed on the New York Stock Exchange under the symbol
"PX".
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
The securities may be sold from time to time directly, through agents or
through underwriters and/or dealers. If any agent of the issuer or any
underwriter is involved in the sale of the securities, the name of such agent or
underwriter and any applicable commission or discount will be set forth in the
accompanying prospectus supplement.
------------------------
THIS PROSPECTUS MAY NOT BE USED UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
------------------------
The date of this prospectus is April 2, 2001.
TABLE OF CONTENTS
PAGE
--------
About This Prospectus....................................... 3
Incorporation of Certain Documents by Reference............. 3
Note Regarding Forward-Looking Statements................... 4
The Company................................................. 4
Use of Proceeds............................................. 5
Ratios of Earnings To Fixed Charges and Earnings To Combined
Fixed Charges and Preferred Stock Dividends............... 5
Description of Capital Stock................................ 6
Description of Debt Securities.............................. 10
Plan of Distribution........................................ 22
Legal Matters............................................... 23
Experts..................................................... 23
2
ABOUT THIS PROSPECTUS
This prospectus is part of a "shelf" registration statement filed with the
United States Securities and Exchange Commission by us. By using a shelf
registration statement, we may sell up to $1,125,000,000 offering price of any
combination of the securities described in this prospectus from time to time and
in one or more offerings. This prospectus only provides you with a general
description of the securities that we may offer. Each time we sell securities,
we will provide a supplement to this prospectus that contains specific
information about the terms of the securities. The prospectus supplement may
also add, update or change information contained in this prospectus. Before
purchasing any securities, you should carefully read both this prospectus and
any prospectus supplement, together with the additional information described
under the heading "Where You Can Find More Information".
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. If anyone provides you
with different or inconsistent information, you should not rely on it. We are
not making an offer of the securities in any jurisdiction where the offer is not
permitted. You should not assume that the information in this prospectus or any
prospectus supplement is accurate as of any date other than the date on the
front of those documents.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
We have filed with the SEC a registration statement on Form S-3 under the
Securities Act of 1933, as amended, with respect to the securities that may be
offered. This prospectus, which forms a part of the registration statement, does
not contain all of the information set forth in the registration statement and
the exhibits and schedules thereto, parts of which are omitted in accordance
with the rules and regulations of the SEC. For more information about us and the
securities, you should see the registration statement and its exhibits and
schedules. Any statement made in this prospectus concerning the provisions of
documents is a summary and you should refer to the copy of that document filed
as an exhibit to the registration statement with the SEC.
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at HTTP://WWW.SEC.GOV or at our web site at
HTTP://WWW.PRAXAIR.COM. You may also read and copy any document we file at the
SEC's public reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549
or in New York and Chicago, as well as at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York, 10005, where our common stock is
listed under the symbol "PX." You can call the SEC at 1-800-732-0330 for further
information about the public reference rooms.
The SEC allows us to "incorporate by reference" the information we file with
them, which means we are assumed to have disclosed important information to you
when we refer you to documents that are on file with the SEC. The information we
have incorporated by reference is an important part of this prospectus, and
information that we file later with the SEC will automatically update and
supersede this information. We incorporate by reference the documents listed
below and all documents we subsequently file with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until we sell all of
the securities covered by this prospectus.
- Our Annual Report on Form 10-K for the fiscal year ended December 31,
2000.
- Current Reports on Form 8-K dated March 1, 2001.
- The description of our capital stock set forth under the caption "Item 11.
Description of Registrant's Securities to be Registered" in the
Registration Statement on Form 10 dated March 10, 1992, as amended by
Form 8 dated May 22, 1992, Form 8 dated June 9, 1992 and Form 8 dated
June 12, 1992.
3
You may request a copy of any or all of the documents that we have
incorporated by reference at no cost by writing to or calling us at the
following address:
Praxair, Inc.
39 Old Ridgebury Road
Danbury, Connecticut 06810-5113
Attn: Assistant Corporate Secretary
Telephone: (203) 837-2000.
NOTE REGARDING FORWARD-LOOKING STATEMENTS
The forward-looking statements contained in this prospectus and any
prospectus supplement (including the documents incorporated herein or therein by
reference) concerning development and commercial acceptance of new products,
services, financial outlook, earnings growth, and other financial goals involve
risks and uncertainties, and are subject to change based on various factors.
These include the impact of changes in worldwide and national economies, the
cost and availability of electric power and other energy and the ability to
achieve price increases to offset such cost increases, development of
operational efficiencies, changes in foreign currencies, changes in interest
rates, the continued timely development and acceptance of new products and
services, the impact of competitive products and pricing, the impact of tax and
other legislation and regulation in the jurisdictions which the company operates
and other risks discussed in this prospectus (including information incorporated
by reference), the applicable prospectus supplement (including information
incorporated by reference) and our filings with the SEC.
Although we believe that the expectations reflected in the forward-looking
statements are responsible, we cannot guarantee future results, levels of
activity, performance or achievements. Moreover, neither we nor any other person
assumes responsibility for the accuracy and completeness of these
forward-looking statements. We are under no duty and do not intend to update any
of the forward-looking statements after the date of this prospectus or to
conform our prior statements to actual results.
THE COMPANY
We are the largest industrial gases company in North and South America and
the third largest worldwide. We are also the world's largest supplier of carbon
dioxide. Our primary products for our industrial gases business are atmospheric
gases (oxygen, nitrogen, argon, rare gases) and process gases (carbon dioxide,
helium, hydrogen, electronic gases, specialty gases, acetylene). Our surface
technology segment, operated through Praxair Surface Technologies, Inc.,
supplies wear-resistant and high-temperature corrosion-resistant metallic and
ceramic coatings and powders. We also design, engineer and build equipment that
produces industrial gases (for internal use and external sale) through our
global supply systems. Our sales were $5,043 million, $4,639 million and
$4,833 million for the years ended December 31, 2000, 1999 and 1998,
respectively, with industrial gases accounting for 88% of sales in 2000, 89% of
sales in 1999 and 90% of sales in 1998, and surface technologies and global
supply systems accounting for the balance.
Gases produced by us find wide use in the metal fabrication, chemicals &
refining, primary metals, food & beverage, healthcare, semiconductor materials,
aerospace, glass, pulp & paper, environmental remediation, and other industries.
By using the gases that we produce and, in many cases, the proprietary processes
that we invent, customer value is created through improved product quality,
increased productivity, conservation of energy, and the attainment of
environmental improvement objectives. We have been and continue to be a major
technological innovator in the industrial gases industry and, working with
customers, have done much to increase the use of our industrial gases to support
the manufacture of other products and for many other uses. Historically,
consumption of
4
industrial gases has increased at approximately 1.5 to 2.0 times local
industrial production growth in countries in which we do business.
We (including our predecessor companies) were founded in 1907 and were
incorporated in Delaware in 1988. Our principal offices are located at 39 Old
Ridgebury Road in Danbury, Connecticut 06810-5113 and our telephone number is
(203) 837-2000.
USE OF PROCEEDS
Except as otherwise described in the applicable prospectus supplement, we
will use the net proceeds from the sale or sales of the securities for general
corporate purposes, which may include, without limitation, the reduction of
outstanding indebtedness, working capital increases, capital expenditures and
acquisitions of companies in a similar line of business. Prior to their
application, the proceeds may be invested in short-term investments. Reference
is made to our financial statements incorporated by reference herein for a
description of the terms of our outstanding indebtedness.
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
The following table sets forth our ratio of earnings to fixed charges and
earnings to combined fixed charges and preferred stock dividends for the periods
indicated:
YEARS ENDED DECEMBER 31,
----------------------------------------------------
2000 1999 1998 1997 1996
-------- -------- -------- -------- --------
Ratio of Earnings to Fixed Charges(a)................... 2.7 3.3 2.8 3.2 2.8
Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends(b).......................... 2.6 3.2 2.7 3.1 2.7
------------------------
(a) For the purpose of computing this ratio: "earnings" consist of income from
continuing operations before provision for income taxes, before fixed
charges, plus dividends from less than 50%-owned companies carried at
equity, less net capitalized interest of consolidated subsidiaries, and
"fixed charges" comprise interest on long-term and short-term debt,
capitalized interest and the portion of rentals representative of an
appropriate interest factor.
(b) For the purpose of computing the foregoing ratio: "earnings" consist of
income from continuing operations before provision for income taxes, before
combined fixed charges, plus dividends from less than 50%-owned companies
carried at equity, less net capitalized interest of consolidated
subsidiaries, and "combined fixed charges" comprise interest on long-term
and short-term debt, capitalized interest, the portion of rentals
representative of an appropriate interest factor and preferred stock
dividends.
5
DESCRIPTION OF CAPITAL STOCK
AUTHORIZED CAPITAL STOCK
Under the Restated Certificate of Incorporation of the Company the total
number of shares of all classes of stock that the Company has authority to issue
is 525,000,000, of which 25,000,000 may be shares of preferred stock, par value
$.01 per share, and 500,000,000 may be shares of common stock, par value $.01
per share. As of December 31, 2000, 166,309,105 shares of our common stock were
issued and 159,379,260 were outstanding and 200,000 shares of our preferred
stock, series B, were issued and outstanding.
COMMON STOCK
Holders of the Company's common stock are entitled to receive ratably
dividends, if any, subject to the prior rights of holders of outstanding shares
of preferred stock, as are declared by the board of directors of the Company out
of the funds legally available for the payment of dividends. Except as otherwise
provided by law, each holder of common stock is entitled to one vote per share
of common stock on each matter submitted to a vote of a meeting of stockholders.
The common stock does not have cumulative voting rights in the election of
directors.
In the event of any liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary, after all liabilities and the holders of each
series of preferred stock have been paid in full, the holders of the Company's
common stock are entitled to receive any remaining assets of the Company.
The Company's common stock has no preemptive or conversion rights or other
subscription rights. There are no redemption or sinking fund provisions
applicable to our common stock. Each outstanding share of the Company's common
stock is accompanied by a right to purchase one share of common stock at a price
of $47.33 per share subject to certain anti-dilution adjustments. This right is
described in more detail below under the heading "Rights Agreement".
The Company is authorized to issue additional shares of common stock without
further stockholder approval (except as may be required by applicable law or
stock exchange regulations). With respect to the issuance of common shares of
any additional series, the board of directors of the Company is authorized to
determine, without any further action by the holders of the Company's common
stock, the dividend rights, dividend rate, conversion rights, voting rights and
rights and terms of redemption, as well as the number of shares constituting
such series and the designation thereof. Should the board of directors of the
Company elect to exercise its authority, the rights and privileges of holders of
the Company's common stock could be made subject to rights and privileges of any
such other series of common stock. The Company has no present plans to issue any
common stock of a series other than the Company's common stock currently issued
and outstanding.
The transfer agent and registrar for the shares of our common stock is The
Bank of New York, Shareholder Relations, Department 11E, P.O. Box 11258, Church
Street Station New York, NY 10286-1258.
PREFERRED STOCK
The Company's board of directors may issue up to 25,000,000 shares of
preferred stock in one or more series and, subject to the Delaware corporation
law, may:
- fix the rights, preferences, privileges and restrictions of the preferred
stock;
- fix the number of shares and designation of any series of preferred stock;
and
- increase or decrease the number of share of any series of preferred stock
but not below the number of outstanding shares.
6
The Company's board of directors has the power to issue our preferred stock
with voting and conversion rights that could negatively affect the voting power
or other rights of our common stockholders, and the board of directors could
take that action without stockholder approval. The issuance of our preferred
stock could delay or prevent a change in control of the Company.
At December 31, 2000, no shares of our preferred stock, series A, were
outstanding and 200,000 shares of our 6.75% cumulative preferred stock,
series B, were issued and outstanding. The outstanding shares of preferred
stock, series B, were issued in December 1996 when PX Merger Corp., a wholly-
owned subsidiary of the Company, was merged into CBI Industries, Inc. At that
time, each outstanding share of CBI preferred stock was exchanged for a share of
the Company's preferred stock, series B, having the same terms. The shares of
the preferred stock, series B, rank senior to the common stock and are entitled
to receive cumulative annual dividends of $6.75 per share, payable quarterly.
The series B preferred stock is mandatorily redeemable on, but not prior to,
September 5, 2002 at a price of $100 per share, plus an amount equal to accrued
and unpaid dividends thereon to the date of redemption, and has a liquidation
preference of $100 per share, plus an amount equal to all dividends on such
shares accrued and unpaid thereon to the date of final distribution. No
dividends may be paid on the Company's common stock or any other stock of the
Company ranking junior to or on a parity with the series B preferred stock
unless the Company's series B preferred stock dividends have been paid. Except
in limited circumstances, the Company may not redeem stock of the Company
ranking on a parity with the series B preferred stock unless all accumulated
dividends have been paid or declared and set apart for payment on the series B
preferred stock. The series B preferred stock has limited voting rights.
If the Company offers any series of preferred stock, whether separately, or
together with, or upon the conversion of, or in exchange for, other securities,
certain terms of that series of preferred stock will be described in the
applicable prospectus supplement, including, without limitation, the following:
- the designation;
- the number of authorized shares of the series in questions;
- voting rights, if any;
- the dividend rate, period and/or payment dates or method of calculation;
- the relative ranking and preferences of the preferred stock as to dividend
rights and rights upon the liquidation, dissolution or winding up of the
Company's affairs;
- any limitations on the issuance of any class or series of preferred stock
ranking senior to or on parity with the class or series of preferred stock
as to dividend rights and rights upon liquidation, dissolution or winding
up of the affairs of the Company;
- the terms and conditions, if any, upon which the preferred stock will be
convertible into or exchangeable for other securities;
- any redemption provisions;
- any sinking fund provisions; and
- any other specific terms, preferences, rights, limitations or restrictions
of the preferred stock.
NO PREEMPTIVE RIGHTS
No holder of any stock of any class of the Company has any preemptive right
to subscribe for any securities of any kind or class.
7
RIGHTS AGREEMENT
Holders of the Company's common stock on June 30, 1992 received one right
for every share of common stock that they held on June 30, 1992. The
stockholders of the Company who have purchased shares of Company common stock
since June 30, 1992 also have one right for every share of our common stock they
own. The right is evidenced by each common stock certificate of the Company.
After an event causing the exercisability of the rights as described below, each
right entitles the holder to purchase from the Company one share of common stock
at a purchase price of $47.33 per share, subject to adjustment. The right also
entitles holders to acquire common stock of an acquirer in the events described
below. The rights agreement serves as an anti-takeover tactic and encourages
third parties interested in acquiring the Company to negotiate directly with our
board of directors.
The terms of the rights are in a rights agreement between us and The Bank of
New York, as rights agent. The description below is a summary of some of the
provisions of the rights agreement.
EVENTS CAUSING THE EXERCISABILITY OF THE RIGHTS
The exercisability of the rights will be triggered:
- 10 days after the public announcement of the acquisition by a person or
group of persons (such person or group of persons will be referred to
herein as the "acquirer") of 15% or more of our common stock; or
- 10 days after the commencement (or announcement of commencement) of a
tender offer or exchange offer that would result in a person or group
becoming an acquirer.
Once the rights are exercisable, stockholders may purchase our common stock
at $47.33 per share.
THE COMPANY'S BOARD OF DIRECTORS MAY REDEEM OR EXCHANGE THE RIGHTS
The Company's board of directors may redeem the rights at a price of $.001
per right at any time prior to the public announcement that a person has become
an acquirer and for 20 business days afterwards. Under certain circumstances,
the decision to redeem shall require the vote of a majority of the independent
directors.
In the event that:
- the Company is the surviving corporation in a merger with an acquirer and
its common stock is not changed or exchanged; or
- a person becomes an acquirer (except pursuant to an offer for all
outstanding shares of the Company's common stock which the independent
directors determine to be fair to the Company's stockholders); or
- an acquirer engages in one or more "self-dealing" transactions as set
forth in the rights agreement; or
- during such time as there is an acquirer, an event occurs (e.g., a reverse
stock split) which results in such acquirer's ownership interest being
increased by more than 1% after a specified date,
each holder of a right (other than rights owned by the acquirer which shall have
become void) will thereafter have the right to receive, upon exercise, the
Company's common stock (or, in certain circumstances, cash, property or other
securities of the Company) having a value equal to two times the purchase price
of $47.33 per share, as adjusted, per right. However, the Company's board of
directors may exchange the rights (other than rights owned by the acquirer which
shall have become void), at
8
any time after the public announcement that a person has become an acquirer, in
whole or in part, at an exchange ratio equal to one times the purchase price of
$47.33 per share, as adjusted, per right.
Until a right is exercised or exchanged, the holder of the right, by virtue
of being a right holder, will have no rights as a stockholder of the Company,
including, for example, the right to vote or to receive dividends.
EXERCISE OF RIGHTS FOR COMPANY COMMON STOCK
After the rights become exercisable and after the time period when the board
of directors' right to redeem the rights has expired, each right holder will
have the right to receive, upon exercise of the rights, the Company's common
stock, or, in some circumstances, cash, property or other securities of the
Company having a value equal to two times the purchase price of $47.33 per
share, as adjusted, per right. Upon a person becoming an acquirer, all rights
that are, or, under some circumstances specified in the rights agreement, were,
owned by any acquirer will be void.
EXERCISE OF RIGHTS FOR SHARES OF THE ACQUIRING COMPANY
If, after the date the rights become exercisable, (1) the Company is
acquired in a merger or other business combination transaction, or (2) 50% or
more of the Company's assets or earning power is sold, each right holder, except
the acquirer, shall afterwards have the right to receive, upon exercise, common
stock of the acquirer having a value equal to two times the exercise price of
$47.33 per share, as adjusted, per right.
ADJUSTMENTS TO EXERCISE PRICE
The exercise price for each right, and the number of shares of common stock
(or other securities or property) issuable, upon exercise of the rights are
subject to adjustment from time to time to prevent dilution.
AMENDMENTS TO TERMS OF THE RIGHTS
Any of the provisions of the rights agreement may be amended by the
Company's board of directors so long as the rights are redeemable. After the
rights are no longer redeemable, the provisions of the rights agreement may be
amended by the Company's board of directors in order to cure any ambiguity,
defect or inconsistency, or to make changes which do not adversely affect the
interests of holders of rights (excluding the interests of any acquirer).
TERM
The rights will expire at the close of business on June 30, 2002, unless
earlier redeemed, exercised or exchanged by the Company as described.
9
DESCRIPTION OF DEBT SECURITIES
Senior Debt Securities may be issued either separately, or together with, or
upon the conversion of, or in exchange for, other securities, from time to time
in one or more series, under an Indenture dated July 15, 1992 (the "Senior
Indenture") between the Company and State Street Bank and Trust Company as the
ultimate successor trustee to Bank of America Illinois (formerly Continental
Bank, National Association), as trustee (the "Senior Trustee"), which is filed
as an Exhibit to the Registration Statement of which this prospectus is a part.
Subordinated Debt Securities may be issued either separately, or together
with, or upon the conversion or, or in exchange for, other securities, from time
to time in series under an indenture (the "Subordinated Indenture") between the
Company and a trustee to be identified in the related prospectus supplement (the
"Subordinated Trustee"). The Subordinated Indenture is filed as an exhibit to
the Registration Statement of which this prospectus is a part. The Senior
Indenture and the Subordinated Indenture are sometimes referred to collectively
as the "Indentures," and the Senior Trustee and the Subordinated Trustee are
sometimes referred to collectively as the "Debt Trustees." The following
statements under this caption are summaries of certain provisions contained or,
in the case of the Subordinated Indenture, to be contained in the Indentures, do
not purport to be complete and are qualified in their entirety by reference to
the Indentures, including the definitions therein of certain terms. Capitalized
terms used herein and not defined shall have the meanings assigned to them in
the related Indenture. The particular terms of the Debt Securities and any
variations from such general provisions applicable to any series of Debt
Securities will be set forth in the prospectus supplement applicable to such
series.
At March 1, 2001, approximately $2,075 million principal amount of Senior
Debt Securities were outstanding under the Senior Indenture ($2,325 million
including Senior Debt issued on March 2, 2001) and there were no Subordinated
Debt Securities outstanding under the Subordinated Indenture. The Senior
Indenture does not and the Subordinated Indenture will not limit the amount of
Debt Securities that may be issued in the future.
10
GENERAL
Each Indenture provides or, in the case of the Subordinated Indenture, will
provide for the issuance of Debt Securities in one or more series with the same
or various maturities. Neither Indenture limits the amount of Debt Securities
that can be issued thereunder and each provides that the Debt Securities may be
issued in series up to the aggregate principal amount which may be authorized
from time to time by the Company. The Debt Securities will be unsecured.
Reference is made to the prospectus supplement for the following terms, if
applicable, of the Debt Securities offered thereby:
(1) the designation, aggregate principal amount, currency or composite
currency and denominations;
(2) the price at which such Debt Securities will be issued and, if an index
formula or other method is used, the method for determining amounts of
principal or interest;
(3) the maturity date and other dates, if any, on which principal will be
payable;
(4) the interest rate (which may be fixed or variable), if any;
(5) the date or dates from which interest will accrue and on which interest
will be payable, and the record dates for the payment of interest;
(6) the manner of paying principal or interest;
(7) the place or places where principal and interest will be payable;
(8) the terms of any mandatory or optional redemption by the Company;
(9) the terms, if any, upon which the debt securities may be convertible
into or exchangeable for other securities;
(10) the terms of any redemption at the option of holders;
(11) whether such Debt Securities are to be issuable as registered Debt
Securities, bearer Debt Securities, or both, and whether and upon what
terms any registered Debt Securities may be exchanged for bearer Debt
Securities and vice versa;
(12) whether such Debt Securities are to be represented in whole or in part
by a Debt Security in global form and, if so, the identity of the
depositary for any global Debt Security;
(13) any tax indemnity provisions;
(14) if the Debt Securities provide that payments of principal or interest
may be made in a currency other than that in which Debt Securities are
denominated, the manner for determining such payments;
(15) the portion of principal payable upon acceleration of a Discounted Debt
Security (as defined below);
(16) whether and upon what terms Debt Securities may be defeased;
(17) any events of default or restrictive covenants in addition to or in lieu
of those set forth in the Indentures;
(18) provisions for electronic issuance of Debt Securities or for Debt
Securities in uncertificated form; and
(19) any additional provisions or other special terms not inconsistent with
the provisions of the Indentures, including any terms that may be
required or advisable under United States or other applicable laws or
regulations, or advisable in connection with the marketing of the Debt
Securities.
11
If the principal of, premium, if any, or interest on Debt Securities of any
series are payable in a foreign or composite currency, any material risks
relating to an investment in such Debt Securities will be described in the
prospectus supplement relating to that series.
Debt Securities of any series may be issued as registered Debt Securities,
bearer Debt Securities or uncertificated Debt securities, as specified in the
terms of the series. Unless otherwise indicated in the applicable prospectus
supplement, registered Debt Securities will be issued in denominations of $1,000
and whole multiples thereof and bearer Debt Securities will be issued in
denominations of $5,000 and whole multiples thereof. The Debt Securities of a
series may be issued in whole or in part in the form of one or more global Debt
Securities that will be deposited with, or on behalf of, a depositary identified
in the prospectus supplement relating to the series. Unless otherwise indicated
in the prospectus supplement relating to a series, the terms of the depositary
arrangement with respect to any Debt Securities of a series specified in the
prospectus supplement as being represented by global Debt Securities will be as
set forth below under "Global Debt Securities."
In connection with its original issuance, no bearer Debt Security will be
offered, sold, resold, or mailed or otherwise delivered to any location in the
United States and a bearer Debt Security in definitive form may be delivered in
connection with its original issuance only if the person entitled to receive the
bearer Debt Security furnishes certification as described in United States
Treasury regulation section 1.163-5(c)(2)(i)(D)(iii). If there is a change in
the relevant provisions or interpretation of United States laws, the foregoing
restrictions will not apply to a series if the Company determines that such
provisions no longer apply to the series or that failure to so comply would not
have an adverse tax effect on the Company or on holders or cause the series to
be treated as "registration-required" obligations under United States law.
For purposes of this prospectus, unless otherwise indicated, "United States"
means the United States of America (including the States and the District of
Columbia), its territories and possessions and all other areas subject to its
jurisdiction. "United States person" means a citizen or resident of the United
States, any corporation, partnership or other entity created or organized in or
under the laws of the United States or a political subdivision thereof or any
estate or trust the income of which is subject to United States federal income
taxation regardless of its source. Any special United States federal income tax
considerations applicable to bearer Debt Securities will be described in the
prospectus supplement relating thereto.
To the extent set forth in the applicable prospectus supplement, except in
special circumstances set forth in the applicable Indenture, principal and
interest on bearer Debt Securities will be payable only upon surrender of bearer
Debt Securities and coupons at a paying agency of the Company located outside of
the United States. During any period thereafter for which it is necessary in
order to conform to United States tax law or regulations, the Company will
maintain a paying agent outside the United States to which the bearer Debt
Securities and coupons may be presented for payment and will provide the
necessary funds therefor to the paying agent upon reasonable notice.
Registration of transfer of registered Debt Securities may be requested upon
surrender thereof at any agency of the Company maintained for that purpose and
upon fulfillment of all other requirements of the agent. Bearer Debt Securities
and the coupons related thereto will be transferable by delivery.
Debt Securities may be issued under the Indentures as Discounted Debt
Securities to be offered and sold at a discount from the principal amount
thereof. Special United States federal income tax and other considerations
applicable thereto will be described in the applicable prospectus supplement
relating to such Discounted Debt Securities. "Discounted Debt Security" means a
Debt Security where the amount of principal due upon acceleration is less than
the stated principal amount.
12
RANKING OF DEBT SECURITIES
The Senior Debt Securities will be unsecured and will rank on a parity with
other unsecured and unsubordinated debt of the Company.
At December 31, 2000, the Company had outstanding approximately
$2,641 million in long-term debt (net of current maturities) consisting of
Senior Indebtedness (as defined below).
The obligations of the Company pursuant to any Subordinated Debt Securities
will be subordinate in right of payment to all Senior Indebtedness of the
Company. "Senior Indebtedness" of the Company is defined to mean the principal
of (and premium, if any) and interest on (a) any and all indebtedness and
obligations of the Company (including indebtedness of others guaranteed by the
Company) other than the Subordinated Debt Securities, whether or not contingent
and whether outstanding on the date of the Subordinated Indenture or thereafter
created, incurred or assumed, which (i) are for money borrowed; (ii) are
evidenced by any bond, note, debenture or similar instrument; (iii) represent
the unpaid balance on the purchase price of any property, business, or asset of
any kind; (iv) are obligations of the Company as lessee under any and all leases
of property, equipment or other assets required to be capitalized on the balance
sheet of the lessee under generally accepted accounting principles; (v) are
reimbursement obligations of the Company with respect to letters of credit; and
(b) any deferrals, amendments, renewals, extensions, modifications and
refundings of any indebtedness or obligations of the types referred to above;
provided that Senior Indebtedness shall not include (i) the Subordinated Debt
Securities; (ii) any indebtedness or obligation of the Company which, by its
express terms or the express terms of the instrument creating or evidencing it,
is not superior in right of payment to the Subordinated Debt Securities; or
(iii) any indebtedness or obligation incurred by the Company in connection with
the purchase of assets, materials or services in the ordinary course of business
and which constitutes a trade payable.
The Subordinated Indenture will not contain any limitation on the amount of
Senior Indebtedness which may be hereafter incurred by the Company.
The Subordinated Indenture will provide that where notice of certain
defaults in respect of Senior Indebtedness has been given to the Company, no
payment with respect to the principal of or interest on the Subordinated Debt
Securities will be made by the Company unless and until such default has been
cured or waived. Upon any payment or distribution of the Company's assets to
creditors of the Company in a liquidation or dissolution of the Company, or in a
reorganization, bankruptcy, insolvency, receivership or similar proceeding
relating to the Company or its property, whether voluntary or involuntary, the
holders of Senior Indebtedness will first be entitled to receive payment in full
of all amounts due thereon before the holders of the Subordinated Debt
Securities will be entitled to receive any payment upon the principal of or
premium, if any, or interest on the Subordinated Debt Securities. By reason of
such subordination, in the event of insolvency of the Company, holders of Senior
Indebtedness of the Company may receive more, ratably, and holders of the
Subordinated Debt Securities may receive less, ratably, than the other creditors
of the Company. Such subordination will not prevent the occurrence of any event
of default in respect of the Subordinated Debt Securities.
CERTAIN COVENANTS
The Senior Indenture contains, among others, the covenants summarized below,
which will be applicable (unless waived or amended) so long as any of the Senior
Debt Securities are outstanding, unless otherwise stated in the applicable
prospectus supplement.
The Debt Securities will not be secured by any properties or assets and will
represent unsecured debt of the Company. Because secured debt ranks ahead of
unsecured debt with respect to the assets securing such secured debt, the
limitation on liens and the limitation on sale-leaseback transactions place some
restrictions on the Company's ability to incur additional secured debt or its
equivalent when
13
the asset securing the debt is a material manufacturing facility in the United
States. The limitations are subject to a number of qualifications and exceptions
described below. There can be no assurance that a facility subject to the
limitations at any time will continue to be subject to those limitations at a
later time.
Unless otherwise indicated in a prospectus supplement, the covenants
contained in the Senior Indenture and the Senior Debt Securities do not afford
holders of the Senior Debt Securities protection in the event of a highly
leveraged or other transaction involving the Company that may adversely affect
holders of the Senior Debt Securities.
DEFINITIONS
"Attributable Debt" for a lease means, as of the date of determination, the
present value of net rent for the remaining term of the lease. Rent shall be
discounted to present value at a discount rate that is compounded semi-annually.
The discount rate shall be 10% per annum or, if the Company elects, the discount
rate shall be equal to the weighted average Yield to Maturity of the Senior Debt
Securities under the Senior Indenture. Such average shall be weighted by the
principal amount of the Senior Debt Securities of each series or, in the case of
Discounted Senior Debt Securities, the amount of principal that would be due as
of the date of determination if payment of the Senior Debt Securities were
accelerated on that date.
Rent is the lesser of (a) rent for the remaining term of the lease assuming
it is not terminated or (b) rent from the date of determination until the first
possible termination date plus the termination payment then due, if any. The
remaining term of a lease includes any period for which the lease has been
extended. Rent does not include (1) amounts due for maintenance, repairs,
utilities, insurance, taxes, assessments and similar charges or (2) contingent
rent, such as that based on sales. Rent may be reduced by the discounted present
value of the rent that any sublessee must pay from the date of determination for
all or part of the same property. If the net rent on a lease is not definitely
determinable, the Company may estimate it in any reasonable manner.
"Consolidated Net Tangible Assets" means total assets less (a) total current
liabilities (excluding short-term Debt and payments due within one year on
long-term Debt) and (b) goodwill, as reflected in the Company's most recent
consolidated balance sheet preceding the date of a determination under
clause (9) of the "Limitation on Liens" covenant of the Senior Indenture.
"Debt" means any debt for borrowed money or any guarantee of such a debt.
"Lien" means any mortgage, pledge, security interest or lien.
"Long-Term Debt" means Debt that by its terms matures on a date more than
12 months after the date it was created or Debt that the obligor may extend or
renew without the obligee's consent to a date more than 12 months after the date
the Debt was created.
"Principal Property" means (i) any manufacturing facility, whether now or
hereafter owned, located in the United States (excluding territories and
possessions), except any such facility that in the opinion of the board of
directors of the Company or any authorized committee of the board is not of
material importance to the total business conducted by the Company and its
consolidated Subsidiaries, and (ii) any shares of stock of a Restricted
Subsidiary. At December 31, 2000, our Principal Properties were our production
facilities in Northern Indiana (air separation/hydrogen/carbon dioxide),
Houston, Texas (air separation) and Detroit, Michigan (air separation/hydrogen),
and, to the extent owned by us, Gulf Coast (hydrogen/carbon monoxide) and
Louisiana (hydrogen/carbon monoxide).
"Restricted Subsidiary" means a Wholly-Owned Subsidiary that has
substantially all of its assets located in the United States (excluding
territories or possessions) or Puerto Rico and owns a Principal Property.
14
"Sale-Leaseback Transaction" means an arrangement pursuant to which the
Company or a Restricted Subsidiary now owns or hereafter acquires a Principal
Property, transfers it to a person, and leases it back from the person.
"Subsidiary" means a corporation a majority of whose Voting Stock is owned
by the Company or a Subsidiary.
"Voting Stock" means capital stock having voting power under ordinary
circumstances to elect directors.
"Wholly-Owned Subsidiary" means a corporation all of whose Voting Stock is
owned by the Company or a Wholly-Owned Subsidiary, the accounts of which are
consolidated with those of the Company in its consolidated financial statements.
"Yield to Maturity" means the yield to maturity on a Security at the time of
its issuance or at the most recent determination of interest on the Security.
LIMITATION ON LIENS
The Company will not, and will not permit any Restricted Subsidiary to,
incur a Lien on Principal Property to secure a Debt unless:
1. the Lien equally and ratably secures the Senior Debt Securities and the
Debt. The Lien may equally and ratably secure the Senior Debt Securities
and any other obligation of the Company or a Subsidiary. The Lien may not
secure an obligation of the Company that is subordinated to the Senior
Debt Securities;
2. the Lien secures Debt incurred to finance all or some of the purchase
price or the cost of construction or improvement of property of the
Company or a Restricted Subsidiary. The Lien may not extend to any other
Principal Property owned by the Company or a Restricted Subsidiary at the
time the Lien is incurred. However, in the case of any construction or
improvement, the Lien may extend to unimproved real property used for the
construction or improvement. The Debt secured by the Lien may not be
incurred more than one year after the later of the (a) acquisition,
(b) completion of construction or improvement or (c) commencement of full
operation, of the property subject to the Lien;
3. the Lien is on property of a corporation at the time the corporation
merges into or consolidates with the Company or a Restricted Subsidiary;
4. the Lien is on property at the time the Company or a Restricted
Subsidiary acquires the property;
5. the Lien is on property of a corporation at the time the corporation
becomes a Restricted Subsidiary;
6. the Lien secures Debt of a Restricted Subsidiary owing to the Company or
another Restricted Subsidiary;
7. the Lien is in favor of a government or governmental entity and secures
(a) payments pursuant to a contract or statute or (b) Debt incurred to
finance all or some of the purchase price or cost of construction or
improvement of the property subject to the Lien;
8. the Lien extends, renews or replaces in whole or in part a Lien
("existing Lien") permitted by any of clauses (1) through (7). The Lien
may not extend beyond (a) the property subject to the existing Lien and
(b) improvements and construction on such property. However, the Lien may
extend to property that at the time is not a Principal Property. The Debt
secured by the
15
Lien may not exceed the Debt secured at the time by the existing Lien
unless the existing Lien or a predecessor Lien was incurred under
clause (1) or (6); or
9. the Debt plus all other Debt secured by Liens on Principal Property at
the time does not exceed 10% of Consolidated Net Tangible Assets.
However, the following Debt shall be excluded from all other Debt in the
determination: (a) Debt secured by a Lien permitted by any of clauses
(1) through (8) and (b) Debt secured by a Lien incurred prior to the date
of the Senior Indenture that would have been permitted by any of those
clauses if the Senior Indenture had been in effect at the time the Lien
was incurred. Attributable Debt for any lease permitted by clause (4) of
the "Limitation on Sale and Leaseback" covenant of the Senior Indenture
must be included in the determination and treated as Debt secured by a
Lien on Principal Property not otherwise permitted by any of clauses
(1) through (8).
In general, clause (9) above, sometimes called a "basket" clause, permits
Liens to be incurred that are not permitted by any of the exceptions enumerated
in clauses (1) through (8) above if the Debt secured by all such additional
Liens does not exceed 10% of Consolidated Net Tangible Assets at the time. At
December 31, 2000, Consolidated Net Tangible Assets were approximately
$5,741 million. At that date, additional Liens securing Debt equal to 10% of
that amount could have been incurred under clause (9).
LIMITATION ON SALE AND LEASEBACK
The Company will not, and will not permit any Restricted Subsidiary to,
enter into a Sale-Leaseback Transaction unless:
1. the lease has a term of three years or less;
2. the lease is between the Company and a Restricted Subsidiary or between
Restricted Subsidiaries;
3. the Company or a Restricted Subsidiary under clauses (2) through (8) of
the "Limitation on Liens" covenant could create a Lien on the property to
secure Debt at least equal in amount to the Attributable Debt for the
lease;
4. the Company or a Restricted Subsidiary under clause (9) of the
"Limitation on Liens" covenant could create a Lien on the property to
secure Debt at least equal in amount to the Attributable Debt for the
lease; or
5. the Company or a Restricted Subsidiary within 180 days of the effective
date of the lease retires Long-Term Debt of the Company or a Restricted
Subsidiary at least equal in amount to the Attributable Debt for the
lease. A Debt is retired when it is paid or cancelled. However, the
Company or a Restricted Subsidiary may not receive credit for retirement
of: Debt of the Company that is subordinated to the Senior Debt
Securities; or Debt, if paid in cash, that is owned by the Company or a
Restricted Subsidiary.
In clauses (3) and (4) above, Sale-Leaseback Transactions and Liens are
treated as equivalents. Thus, if the Company or a Restricted Subsidiary could
create a Lien on a property, it may enter into a Sale-Leaseback Transaction to
the same extent.
LIMITATION ON DEBT OF RESTRICTED SUBSIDIARIES
The Company will not permit any Restricted Subsidiary to incur any Debt
unless:
1. such Restricted Subsidiary could create Debt secured by Liens in
accordance with the "Limitation on Liens" covenant in an amount equal to
such Debt, without equally and ratably securing the Senior Debt
Securities;
16
2. the Debt is owed to the Company or another Restricted Subsidiary;
3. the Debt is Debt of a corporation at the time the corporation becomes a
Restricted Subsidiary;
4. the Debt is Debt of a corporation at the time the corporation merges
into or consolidates with a Restricted Subsidiary or at the time of a
sale, lease or other disposition of its properties as an entirety or
substantially as an entirety to a Restricted Subsidiary;
5. the Debt is incurred to finance all or some of the purchase price or the
cost of construction or improvement of property of the Restricted
Subsidiary. The Debt may not be incurred more than one year after the
later of the (a) acquisition, (b) completion of construction or
improvement or (c) commencement of full operation, of the property;
6. the Debt is incurred for the purpose of extending, renewing or replacing
in whole or in part Debt permitted by any of clauses (1) through (5); or
7. the Debt plus all other Debt of Restricted Subsidiaries at the time does
not exceed 10% of Consolidated Net Tangible Assets. However, the
following Debt shall be excluded from all other Debt in the
determination: (a) Debt permitted by any of clauses (1) through (6) and
(b) Debt incurred prior to the date of the Senior Indenture that would
have been permitted by any of those clauses if the Senior Indenture had
been in effect at the time the Debt was incurred.
SUCCESSOR OBLIGOR
The Indentures provide or, in the case of the Subordinated Indenture, will
provide that the Company will not consolidate with or merge into, or transfer
all or substantially all of its assets to, any person, unless (1) the person is
organized under the laws of the United States or a State thereof; (2) the person
assumes by supplemental indenture all the obligations of the Company under the
applicable Indenture, the Debt Securities issued under such Indenture and any
coupons pertaining thereto; (3) immediately after the transaction no default
exists; and (4) if, as a result of the transaction, a Principal Property would
become subject to a Lien not permitted by the "Limitation on Liens" covenant of
the Senior Indenture, the Company or such person secures the Senior Debt
Securities equally and ratably with or prior to all obligations secured by the
Lien.
The successor will be substituted for the Company, and thereafter all
obligations of the Company under the applicable Indenture, the Debt Securities
issued under such Indenture and any coupons shall terminate.
EXCHANGE OF SECURITIES
Registered Debt Securities may be exchanged for an equal aggregate principal
amount of registered Debt Securities of the same series and date of maturity in
such authorized denominations as may be requested upon surrender of the
registered Debt Securities at an agency of the Company maintained for such
purpose and upon fulfillment of all other requirements of the agent.
To the extent permitted by the terms of a series of Debt Securities
authorized to be issued in registered form and bearer form, bearer Debt
Securities may be exchanged for an equal aggregate principal amount of
registered or bearer Debt Securities of the same series and date of maturity in
such authorized denominations as may be requested upon surrender of the bearer
Debt Securities with all unpaid coupons relating thereto (except as may
otherwise be provided in the Debt Securities) at an agency of the Company
maintained for such purpose and upon fulfillment of all other requirements of
the agent. As of the date of this prospectus, it is expected that the terms of a
series of Debt Securities will not permit registered Debt Securities to be
exchanged for bearer Debt Securities.
17
DEFAULTS AND REMEDIES
An "event of default" with respect to any series of Debt Securities will
occur if:
1. the Company defaults in any payment of interest on any Debt Securities
of the series when the same becomes due and payable and the default
continues for a period of 10 days;
2. the Company defaults in the payment of the principal of any Debt
Securities of the series when the same becomes due and payable at
maturity or upon redemption, acceleration or otherwise;
3. the Company defaults in the performance of any of its other agreements
applicable to the series and the default continues for 90 days after the
notice specified below;
4. the Company pursuant to or within the meaning of any Bankruptcy Law:
- commences a voluntary case,
- consents to the entry of an order for relief against it in an
involuntary case,
- consents to the appointment of a custodian for it or for all or
substantially all of its property, or
- makes a general assignment for the benefit of its creditors;
5. a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
- is for relief against the Company in an involuntary case,
- appoints a custodian for the Company or for all or substantially all of
its property, or
- orders the liquidation of the Company;
and the order or decree remains unstayed and in effect for 60 days; or
6. any other event of default provided for in the series.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal
or State law for the relief of debtors. The term "custodian" means any receiver,
trustee, assignee, liquidator or a similar official under any Bankruptcy Law.
A default under clause (3) is not an event of default until the applicable
Debt Trustee or the holders of at least 25% in principal amount of the series
notify the Company of the default and the Company does not cure the default
within the time specified after receipt of the notice. The applicable Debt
Trustee may require indemnity satisfactory to it before it enforces the
applicable Indenture or the Debt Securities of the series. Subject to certain
limitations, holders of a majority in principal amount of the Debt Securities of
the series may direct the applicable Debt Trustee in its exercise of any trust
or power. A Debt Trustee may withhold from holders of the series notice of any
continuing default (except a default in payment of principal or interest) if it
determines that withholding notice is in their interest.
18
The Indentures do not have or, in the case of the Subordinated Indenture,
will not have cross-default provisions. Thus, a default by the Company or a
Subsidiary on any other debt would not constitute an event of default.
AMENDMENTS AND WAIVERS
Unless the resolution establishing the terms of a series otherwise provides,
the applicable Indenture and the Debt Securities or any coupons of the series
may be amended, and any default may be waived as follows: The Debt Securities
and the applicable Indenture may be amended with the consent of the holders of a
majority in principal amount of the Debt Securities of all series affected
voting as one class. A default on a series may be waived with the consent of the
holders of a majority in principal amount of the Debt Securities of the series.
However, without the consent of each holder affected, no amendment or waiver may
(1) reduce the amount of Debt Securities whose holders must consent to an
amendment or waiver, (2) reduce the interest on or change the time for payment
of interest on any Debt Security, (3) change the fixed maturity of any Debt
Security, (4) reduce the principal of any non-Discounted Debt Security or reduce
the amount of principal of any Discounted Debt Security that would be due on
acceleration thereof, (5) change the currency in which principal or interest on
a Debt Security is payable, (6) waive any default in payment of interest on or
principal of a Debt Security or (7) change certain provisions of the applicable
Indenture regarding waiver of past defaults and amendments with the consent of
holders other than to increase the principal amount of Debt Securities required
to consent. Without the consent of any holder, the applicable Indenture, the
Debt Securities or any coupons may be amended to cure any ambiguity, omission,
defect or inconsistency; to provide for assumption of Company obligations to
holders in the event of a merger or consolidation requiring such assumption; to
provide that specific provisions of the applicable Indenture not apply to a
series of Debt Securities not previously issued; to create a series and
establish its terms; to provide for a separate Debt Trustee for one or more
series; or to make any change that does not materially adversely affect the
rights of any holder.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Debt Securities of a series may be defeased in accordance with their terms
and, unless the resolution establishing the terms of the series otherwise
provides, as set forth below. The Company at any time may terminate as to a
series all of its obligations (except for certain obligations with respect to
the defeasance trust and obligations to register the transfer or exchange of a
Debt Security, to replace destroyed, lost or stolen Debt Securities and coupons
and to maintain agencies in respect of the Debt Securities) with respect to the
Debt Securities of the series and any related coupons and the applicable
Indenture ("legal defeasance"). The Company at any time may terminate as to a
series its obligations with respect to the Debt Securities and coupons of the
series under the covenants described under "Certain Covenants" ("covenant
defeasance").
The Company may exercise its legal defeasance option notwithstanding its
prior exercise of its covenant defeasance option. If the Company exercises its
legal defeasance option, a series may not be accelerated because of an event of
default. If the Company exercises its covenant defeasance option, a series may
not be accelerated by reference to the covenants described under "Certain
Covenants."
To exercise either option as to a series, the Company must deposit in trust
(the "defeasance trust") with the applicable Debt Trustee money or U.S.
Government Obligations for the payment of principal, premium, if any, and
interest on the Debt Securities of the series to redemption or maturity and must
comply with certain other conditions. In particular, the Company must obtain an
opinion of tax counsel that the defeasance will not result in recognition for
Federal income tax purposes of any gain or loss to holders of the series. "U.S.
Government Obligations" are direct obligations of the United States of America
which have the full faith and credit of the United States of America pledged for
payment and
19
which are not callable at the issuer's option, or certificates representing an
ownership interest in such obligations.
GLOBAL DEBT SECURITIES
Global Debt Securities may be issued in registered, bearer or uncertificated
form and in either temporary or permanent form. If Debt Securities of a series
are to be issued as global Debt Securities, one or more global Debt Securities
will be issued in a denomination or aggregate denominations equal to the
aggregate principal amount of outstanding Debt Securities of the series to be
represented by such global Debt Security or Securities.
Ownership of beneficial interests in global Debt Securities will be limited
to participants and to persons that have accounts with the depositary
("participants") or persons that may hold interests through participants.
Ownership interests in global Debt Securities will be shown on, and the transfer
of that ownership interest will be effected only through, records maintained by
the depositary or its nominee for such global Debt Securities (with respect to a
participant's interest) and records maintained by participants (with respect to
interests of persons other than participants).
Unless otherwise indicated in a prospectus supplement, payment of principal
of and any premium and interest on the book-entry Debt Securities represented by
a global Debt Security will be made to the depositary or its nominee, as the
case may be, as the sole registered owner and the sole holder of the book-entry
Debt Securities represented thereby for all purposes under the applicable
Indenture. Neither the Company or the applicable Debt Trustee, nor any agent of
the Company or the applicable Debt Trustee, will have any responsibility or
liability for any acts or omissions of the depositary for any records of the
depositary relating to beneficial ownership interests in any global Debt
Security any transactions between a depositary and beneficial owners.
Upon receipt of any payment of principal of or any premium or interest on a
global Debt Security, the depositary will immediately credit, on its book-entry
registration and transfer system, the accounts of participants with payments in
amounts proportionate to their respective beneficial interests in the principal
amount of such global Debt Security as shown on the records of the depositary.
Payments by participants to owners of beneficial interests in global Debt
Securities held through such participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for customer accounts registered in "street name," and will be the sole
responsibility of such participants.
Unless otherwise stated in a prospectus supplement, global Debt Securities
will not be transferred except as a whole by the depositary to a nominee of the
depositary. Global Debt Securities will be exchangeable only if (i) the
depositary notifies the Company that it is unwilling or unable to continue as
depositary for such global Debt Securities or if at any time the depositary
ceases to be a clearing agency registered under the Exchange Act, (ii) the
Company in its sole discretion determines that such global Debt Securities shall
be exchangeable for definitive Debt Securities in registered form, or (iii) an
event of default with respect to the series of Debt Securities represented by
such global Debt Securities has occurred and is continuing. Any global Debt
Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Registered Debt Securities issuable in denominations of $1,000
and integral multiples thereof and registered in such names as the depositary
holding such global Debt Security shall direct. Subject to the foregoing, the
global Debt Security is not exchangeable, except for a global Debt Security of
like denomination to be registered in the name of the depositary or its nominee.
So long as the depositary for global Debt Securities of a series, or its
nominee, is the registered owner of such global Debt Securities, such depositary
or such nominee, as the case may be, will be considered the sole holder of Debt
Securities represented by such global Debt Securities for the purposes of
receiving payment on such global Debt Securities, receiving notices and for all
other
20
purposes under the applicable Indenture and such global Debt Securities. Except
as provided above, owners of beneficial interests in global Debt Securities of a
series will not be entitled to receive physical delivery of Debt Securities of
such series in definitive form and will not be considered the holders thereof
for any purpose under the applicable Indenture. Accordingly, each person owning
a beneficial interest in a global Debt Security must rely on the procedures of
the depositary and, if such person is not a participant, on the procedures of
the participant through which such person owns its interest, to exercise any
rights of a holder under the applicable Indenture. The depositary may grant
proxies and otherwise authorize participants to give or take any request,
demand, authorization, direction, notice, consent, waiver or other action which
a holder is entitled to give or take under the applicable Indenture. The Company
understands that under existing industry practices, in the event that the
Company requests any action of holders or that an owner of a beneficial interest
in such a global Debt Security desires to give or take any action which a holder
is entitled to give or take under the applicable Indenture, the depositary would
authorize the participants holding the relevant beneficial interests to give or
take such action, and such participants would authorize beneficial owners owning
through such participants to give or take such action or would otherwise act
upon the instructions of beneficial owners owning through them.
Unless otherwise specified in a prospectus supplement relating to Debt
Securities of a series to be issued as global Debt Securities, the depositary
will be The Depository Trust Company. DTC has advised the Company that it is a
limited-purpose trust company organized under the law of the State of New York,
a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered under the Exchange Act. DTC was created to hold the securities of its
participants and to facilitate the clearance and settlement of securities
transactions among its participants in such securities through electronic
book-entry changes in accounts of the participants, thereby eliminating the need
for physical movement of securities certificates. DTC's participants include
securities brokers and dealers (which may include the underwriters, dealers or
agents with respect to the Debt Securities), banks, trust companies, clearing
corporations, and certain other organizations some of whom (and/or their
representatives) own DTC. Access to DTC's book-entry system is also available to
others, such as banks, brokers, dealers and trust companies that clear through
or maintain a custodial relationship with a participant either directly or
indirectly.
CONVERSION AND EXCHANGE
The terms, if any, on which debt securities of any series are convertible
into or exchangeable for our common stock, preferred stock, or other debt
securities will be set forth in the applicable prospectus supplement. Those
terms may include provisions for conversion or exchange, whether mandatory, at
the option of the holders or at our option.
TRUSTEE
State Street Bank and Trust Company, as the ultimate successor trustee to
Bank of America Illinois (formerly Continental Bank, National Association) will
act as Senior Trustee for Debt Securities issued under the Senior Indenture. The
Subordinated Trustee for Debt Securities issued under the Subordinated Indenture
will be identified in the related prospectus supplement. The Senior Trustee is
one of several banks which provide credit and banking services to the Company.
21
PLAN OF DISTRIBUTION
The Company may sell securities in any of the following ways:
(1) through underwriters or dealers;
(2) directly to one or more purchasers;
(3) through agents or
(4) through a combination of any such methods of sale.
Any of these underwriters, dealers or agents may be deemed to be an underwriter
within the meaning of the Securities Act. The prospectus supplement with respect
to the securities being offered thereby will set forth the terms of the offering
of such securities, including the name or names of any underwriters or agents,
the purchase price of such securities and the proceeds to the Company from such
sale, any underwriting discounts, commissions and other items constituting
underwriters' compensation, any initial public offering price and any discounts
or concessions allowed or reallowed or paid to dealers and any securities
exchanges on which such securities may be listed.
If underwriters are used in the sale of securities, such securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The securities may be offered to the public either through underwriting
syndicates (which may be represented by managing underwriters designated by the
Company), or directly by one or more underwriters acting alone. Unless otherwise
set forth in the prospectus supplement, the obligations of the underwriters to
purchase the securities offered thereby will be subject to certain conditions
precedent, and the underwriters will be obligated to purchase all such
securities if any are purchased. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time.
The securities may be sold directly by the Company or through agents
designated by the Company from time to time. The prospectus supplement with
respect to any securities sold in this manner will set forth the name of any
agent involved in the offer or sale of the securities as well as any commissions
payable by the Company to such agent. Unless otherwise indicated in the
prospectus supplement, any such agent is acting on a best efforts basis for the
period of its appointment.
If dealers are utilized in the sale of any securities, the Company will sell
the securities to the dealers, as principals. Any dealer may then resell the
securities to the public at varying prices to be determined by the dealer at the
time of resale. The name of any dealer and the terms of the transaction will be
set forth in the prospectus supplement with respect to the securities being
offered thereby.
If so indicated in the prospectus supplement, the Company will authorize
agents, underwriters or dealers to solicit offers by certain specified
institutions to purchase securities from the Company at the public offering
price set forth in the prospectus supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the future.
Such contracts will be subject only to those conditions set forth in the
prospectus supplement and the prospectus supplement will set forth the
commission payable for the solicitation of such contracts.
In connection with the offering of the securities, underwriters may engage
in transactions that stabilize, maintain or otherwise effect the price of the
securities. Specifically, the underwriters may overallot in connection with the
offerings of the securities, creating a syndicate short position. In addition,
underwriters may bid for, and purchase, securities in the open market to cover
syndicate shorts or to stabilize the price of the securities. Finally, the
underwriting syndicate may reclaim selling concessions allowed for distributing
the securities in the offering of the securities, if the syndicate
22
repurchases previously distributed securities in syndicate covering
transactions, syndicate transactions or otherwise. Any of these activities may
stabilize or maintain the market prices of the securities above independent
market levels. The underwriters are not required to engage in any of these
activities, and may end any of them at any time.
It has not been determined whether any securities will be listed on a
securities exchange. Underwriters will not be obligated to make a market in any
securities. The Company cannot predict the activity of trading in, or liquidity
of, any securities.
Agents, underwriters and dealers may be entitled, under agreements entered
into with the Company, to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act or to contribution
with respect to payments which the agents, underwriters or dealers may be
required to make in respect thereof. Agents, underwriters and dealers may be
customers of, engage in transactions with, or perform services for the Company
in the ordinary course of business.
LEGAL MATTERS
Certain legal matters in connection with the securities will be passed upon
for the Company by Cahill Gordon & Reindel, New York, New York, and for the
agents, underwriters and dealers by Davis Polk & Wardwell of New York, New York.
EXPERTS
The consolidated financial statements incorporated in this Prospectus by
reference to the Annual Report on Form 10-K of Praxair, Inc. for the year ended
December 31, 2000 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
23
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$500,000,000
[LOGO]
6.375% NOTES DUE APRIL 1, 2012
-------------------------------------
PROSPECTUS SUPPLEMENT
MARCH 14, 2002
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------------------------
JOINT BOOK-RUNNING MANAGERS
Banc of America Securities LLC Deutsche Banc Alex. Brown
----------------
ABN AMRO Incorporated
Commerzbank Capital Markets Corp.
Credit Suisse First Boston
Fleet Securities, Inc.
JPMorgan
Lehman Brothers
Merrill Lynch & Co
Morgan Stanley
Salomon Smith Barney
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