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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Air Products and Chemicals, Inc.
(Name of Issuer)
Common Stock, Par Value $1 Per Share
(Title of Class of Securities)
210 00915810
(CUSIP Number)
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Sandy S. McKenna James H. Agger, Esquire
Assistant Vice President Vice President, Secretary and
Mellon Bank (DE) General Counsel
National Association Air Products and Chemicals, Inc.
Mellon Bank Center 7201 Hamilton Boulevard
10th and Market Streets, 2nd Fl. Allentown, PA 18195-1501
Wilmington, DE 19801 (215) 481-4911
(302) 654-9393
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(Name, address and telephone number of person authorized
to receive notices and communications)
December 29, 1993
(Date of Event which requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box [ ].
Check the following box if a fee is being paid with this statement [x].
(Page 1 of 10)
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CUSIP NO. 210 00915810 Page 2 of 10
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Mellon Bank (DE) National Association, as Trustee under Air Products and Chemicals, Inc. Flexible Employee
Benefits Trust
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
Not Applicable
3 SEC USE ONLY
4 SOURCE OF FUNDS
SC, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
0
NUMBER OF SHARES
BENEFICIALLY OWNED BY 8 SHARED VOTING POWER
EACH REPORTING PERSON
WITH 10,000,000
9 SOLE DISPOSITIVE POWER
0
10 SHARED DISPOSITIVE POWER
10,000,000
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
10,000,000 shares
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.1%
14 TYPE OF REPORTING PERSON
BK, EP
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CUSIP NO. 210 00915810 Page 3 of 10
The filing of this Schedule 13D by the Air Products and Chemicals,
Inc. Flexible Employee Benefits Trust (the "Trust") does not constitute, and
should not be construed as, an admission that either the Trust or Mellon Bank
(DE) National Association, as trustee of the Trust (the "Trustee"),
beneficially owns any securities covered by this Schedule or is required to
file this Schedule. In this connection, the Trust and the Trustee disclaim
beneficial ownership of the securities covered by this Schedule.
ITEM 1. SECURITY AND ISSUER
The class of equity securities to which this Schedule relates is the
Common Stock, par value $1 per share ("Common Stock"), of Air Products and
Chemicals, Inc., a Delaware corporation (the "Issuer"). The principal
executive offices of the Issuer are located at 7201 Hamilton Boulevard,
Allentown, PA 18195-1501.
ITEM 2. IDENTITY AND BACKGROUND
This Schedule is being filed by the Air Products and Chemicals, Inc.
Flexible Employee Benefits Trust. The Trust's address is c/o Mellon Bank (DE)
National Association, Mellon Bank Center, 10th and Market Streets, 2nd Floor,
Wilmington, DE 19801. The Trustee's address is Mellon Bank (DE) National
Association, Mellon Bank Center, 10th and Market Streets, 2nd Floor,
Wilmington, DE 19801. The Trust is a trust organized under the laws of the
State of Delaware and is
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CUSIP NO. 210 00915810 Page 4 of 10
not engaged in the conduct of any business. The Trustee is a national banking
association organized under the laws of the United States.
During the last five years, neither the Trust nor the Trustee (i) has
been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors) or (ii) was a party to a civil proceeding of a judicial
or administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to,
Federal or State securities laws or finding any violation with respect to such
laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
On December 29, 1993, the Issuer and the Trustee entered into the Air
Products and Chemicals, Inc. Flexible Employee Benefits Trust Agreement
creating the Trust (the "Trust Agreement") and the Common Stock Purchase
Agreement (the "Purchase Agreement"). A copy of the Trust Agreement is annexed
hereto as Exhibit 1. A copy of the Purchase Agreement is annexed hereto as
Exhibit 2. Pursuant to the terms of the Trust Agreement the Issuer sold
10,000,000 shares of Common Stock to the Trust at a price of $45.75
per share, which is the market value of the Common Stock determined on the
basis of the closing price of the Common Stock on the trading day immediately
preceding the sale, as reported in the Wall Street Journal on the composite
tape for issues listed on the New York
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CUSIP NO. 210 00915810 Page 5 of 10
Stock Exchange, or an aggregate purchase price of $457,500,000.00. The
obligation to pay the purchase price is evidenced by a promissory note (the
"Note") delivered by the Trustee to the Issuer. The form of such Note is set
forth as Appendix 1 to the Purchase Agreement. The Note bears interest at the
rate of 7.5% per annum and is payable in installments as provided therein.
The Issuer shall from time to time contribute cash to the Trust which,
together with earnings of the Trust (primarily dividends on the shares of
Common Stock), will enable the Trustee to make payment of installments of
principal and interest on the Note. If, on the due date of any such
installment, insufficient contributions have been made in cash, the amount of
the deficiency with respect to such installment shall be deemed paid in the
form of forgiveness of such principal and interest installment. The Note is
subject to prepayment in a similar manner.
ITEM 4. PURPOSE OF TRANSACTION
The Issuer has advised the Trustee that the Trust was created to
provide for the satisfaction of certain obligations of the Issuer and its
affiliates under various employee plans, programs, contracts and structures of
the Issuer and its affiliates, (the "Plans"), including those providing for the
acquisition by employees of shares of Common Stock. The Issuer has further
advised the Trustee that the Trust should have the effect of enhancing the
Issuer's credit capacity and financial flexibility.
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CUSIP NO. 210 00915810 Page 6 of 10
The Issuer has also advised the Trustee that the Trust is not intended
to be an antitakeover device. However, the Issuer has further advised the
Trustee that the creation of the Trust and the purchase of shares of Common
Stock by the Trust may be considered to have certain antitakeover effects. The
Trust holds approximately 8.1% of the outstanding shares of Common Stock.
Under the Delaware General Corporation Law ("DGCL"), a merger requires the
affirmative vote of a majority of the outstanding shares. The sale of shares
of Common Stock to the Trust could thus make it more difficult for an acquiror
to obtain an affirmative merger vote without employee support. Similarly,
pursuant to Section 203 of the DGCL, an interested stockholder (defined as one
owning more than 15% of an issuer's stock) may not engage in a business
combination with an issuer for three years after the date he becomes an
interested stockholder unless (1) prior to such date the board of directors
approved the business combination in question or transaction which resulted in
such holder becoming an interested stockholder, (2) on or after such date, the
business combination is approved by the board of directors and the holders of
two-thirds of the outstanding shares not held by the interested stockholder or
(3) the interested stockholder acquired at least 85% of the issuer's voting
stock in the same transaction that resulted in his becoming an interested
stockholder.
A potential acquiror could find it more difficult to engage in a
business combination with the Issuer under the circumstances described under
Section 203 of the DGCL which require approval of two-thirds of the outstanding
shares without
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CUSIP NO. 210 00915810 Page 7 of 10
employee support since the Trustee will vote the Common Stock and will tender
or exchange, or not tender or exchange, the Common Stock held by the Trust in
the same proportion and manner as the participants of the Air Products and
Chemicals, Inc. Retirement Savings and Stock Ownership Plan qualified under
Section 401(k) of the Internal Revenue Code of 1986 (the "RSSOP") direct the
trustee of the RSSOP with respect to Common Stock held by the RSSOP.
Stock held by employee stock plans is excluded from the 85%
calculation under Section 203 of the DGCL unless the employees have the right
to determine confidentially whether shares held by a plan will be tendered in a
tender or exchange offer. The Trust requires that voting and tendering or
exchange actions and directions be held confidential by the Trustee. Some or
all of the Common Stock held in the Trust may be deemed held by participants
in the RSSOP through the Trust for purposes of this calculation under Section
203 and, thus, included in the 85% calculation. Therefore, a potential acquiror
who has not received the Issuer's Board of Directors approval prior to becoming
an interested stockholder could find it more difficult to attain an 85%
ownership threshold unless he is able to induce some employees to direct the
Trustee of the RSSOP to tender shares to the potential acquiror.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
The Trust holds 10,000,000 shares of Common Stock, representing
approximately 8.1% of the outstanding shares of Common Stock, as to which it
may
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CUSIP NO. 210 00915810 Page 8 of 10
be deemed to have shared power to vote or to direct the vote or to dispose or
direct the disposition, as hereinafter stated. The filing of this Schedule 13D
by the Trust does not constitute, and should not be construed as, an admission
that either the Trust or the Trustee beneficially owns any securities covered
by this Schedule or is required to file this Schedule. The Trust and the
Trustee disclaim beneficial ownership of the securities covered by this
Schedule.
Shares of Common Stock acquired pursuant to the Trust Agreement are
held in the Trust and will be released as the principal of the Note is paid or
forgiven and will be transferred to or for the benefit of the Plans in the
manner set forth in the Trust Agreement. As of the date hereof, no shares of
Common Stock have been released from the Trust pursuant to the terms of the
Trust Agreement. The Issuer has advised the Trustee that contributions, if
any, by the Issuer to or for the benefit of the Plans will be decreased by the
value of the released shares transferred from the Trust to or for the benefit
of the Plans.
The Trustee has no discretion in the manner in which the Common Stock
will be voted. The Trust Agreement provides that the Trustee must vote all of
the Common Stock held by the Trust in the same proportion and manner as the
participants of the RSSOP direct the trustee of the RSSOP with respect to the
voting of the Common Stock held by the RSSOP. The Trust Agreement also
provides that if a tender or exchange offer is commenced for Common Stock, then
the Trustee will tender or exchange, or not tender or exchange, the Common
Stock held by the Trust
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CUSIP NO. 210 00915810 Page 9 of 10
in the same proportion and manner as the participants of the RSSOP direct the
trustee of the RSSOP with respect to Common Stock held by the RSSOP. The Trust
Agreement further provides that all voting and tendering or exchange actions
and directions will be held in confidence by the Trustee and not disclosed to
any person, including officers and employees of the Issuer.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
The Issuer and the Trustee have entered into the Trust Agreement and
the Purchase Agreement, and the Trustee, as trustee for the Trust, has issued
the Note to the Issuer in payment for the 10,000,000 shares of Common Stock
issued to the Trust. See also Item 3 and 5 of this Schedule.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
1. Air Products and Chemicals, Inc. Flexible Employee Benefits
Trust Agreement dated December 29, 1993, between Air Products
and Chemicals, Inc. and Mellon Bank (DE) National Association,
as trustee.
2. Common Stock Purchase Agreement dated December 29, 1993,
between Air Products and Chemicals, Inc. and Mellon Bank (DE)
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CUSIP NO. 210 00915810 Page 10 of 10
National Association, as trustee. (Appendix 1 to this
agreement is Exhibit 3 to this Schedule 13D.)
3. Form of Promissory Note dated December 29, 1993, between Air
Products and Chemicals, Inc. and Mellon Bank (DE) National
Association, as trustee.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
MELLON BANK (DE) NATIONAL ASSOCIATION,
as Trustee under the Air Products
and Chemicals, Inc. Flexible
Employee Benefits Trust Agreement
By: /s/ Sandy S. McKenna
-----------------------------------
Name: Sandy S. McKenna
Title: Assistant Vice President
Dated: December 29, 1993
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EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
1. Air Products and Chemicals, Inc. Flexible Employee Benefits
Trust Agreement dated December 29, 1993, between Air Products
and Chemicals, Inc. and Mellon Bank (DE) National Association,
as trustee.
2. Common Stock Purchase Agreement dated December 29, 1993,
between Air Products and Chemicals, Inc. and Mellon Bank (DE)
National Association, as trustee. (Appendix 1 to this
agreement is Exhibit 3 to this Schedule 13D.)
3. Form of Promissory Note dated December 29, 1993, between Air
Products and Chemicals, Inc. and Mellon Bank (DE) National
Association, as trustee.
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AIR PRODUCTS AND CHEMICALS, INC.
FLEXIBLE EMPLOYEE BENEFITS TRUST AGREEMENT
Effective as of December 29, 1993
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TABLE OF CONTENTS
PAGE
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ARTICLE 1
TRUST, TRUSTEE AND TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.4 Trust Fund Subject to Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.5 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE 2
CONTRIBUTIONS AND DIVIDENDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.1 Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.2 Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.3 Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE 3
RELEASE AND TRANSFER OF COMPANY STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.1 Company Stock Made Available for Transfer from Trust . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.2 Transfer From Trust of Released Shares and Cash Proceeds . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE 4
COMPENSATION, EXPENSES AND TAX WITHHOLDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.1 Compensation and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.2 Withholding of Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE 5
ADMINISTRATION OF TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.1 Management and Control of Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.2 Investment of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.3 Trustee's Administrative Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
5.4 Rights Regarding Company Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
5.5 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.6 General Duty to Communicate to Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE 6
ACCOUNTS AND REPORTS OF TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.1 Records and Accounts of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.2 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.3 Reports of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.4 Final Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
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TABLE OF CONTENTS
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6.5 Valuation of Company Stock for Purposes of Reports, Tax Returns and Filings . . . . . . . . . . . . . 14
ARTICLE 7
SUCCESSION OF TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7.1 Resignation of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7.2 Removal of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7.3 Appointment of Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7.4 Succession to Trust Fund Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
7.5 Continuation of Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
7.6 Changes in Organization of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
7.7 Continuance of Trustee's Powers in Event of Termination of the Trust . . . . . . . . . . . . . . . . . 15
ARTICLE 8
AMENDMENT OR TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
8.1 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
8.2 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.3 Effect of Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.4 Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.5 Form of Amendment or Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE 9
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
9.1 Controlling Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
9.2 Committee Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
9.3 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
9.4 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.5 Protection of Persons Dealing with the Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.6 Tax Status of Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.7 No Third Party Rights; Participants to Have No Interest in the Company by Reason of the Trust . . . . 18
9.8 Nonassignability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.9 Gender and Plurals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.10 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
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<PAGE> 4
EMPLOYEE BENEFITS TRUST AGREEMENT
THIS TRUST AGREEMENT (this "Agreement"), is made effective as of
December 29, 1993, between AIR PRODUCTS AND CHEMICALS, INC., a Delaware
corporation, and Mellon Bank (DE) National Association, a national banking
association, as trustee.
WHEREAS, the Company (as herein defined) desires to establish a trust
(the "Trust") in accordance with the laws of the State of Delaware and for the
purposes stated in this Agreement;
WHEREAS, the Trustee (as herein defined) has corporate trust powers
under the laws of the State of Delaware and desires to act as trustee of the
Trust, and to hold legal title to the assets of the Trust, in trust, for the
purposes hereinafter-stated and in accordance with the terms hereof;
WHEREAS, the Company has previously adopted, and may hereafter adopt
additional, Plans (as herein defined);
WHEREAS, the Company desires to provide for the availability of shares
of its common stock to satisfy certain of its obligations under the Plans, and
intends to contribute or sell to the Trust such assets that shall be held
therein, subject to the claims of the Company's general creditors in the event
of the Company's Insolvency, as herein defined, until made available to the
Plans in such manner and at such times as specified herein;
WHEREAS, the Company desires that the assets to be held in the Trust
Fund (as herein defined) should be principally or exclusively securities of the
Company and, therefore expressly waives any diversification of investments that
might otherwise be necessary, appropriate or required pursuant to applicable
provisions of law; and
WHEREAS, the Trustee has been appointed as trustee and has accepted
such appointment as of the date first set forth above;
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby establish the Trust and agree that the Trust will be comprised, held and
disposed of as follows:
<PAGE> 5
ARTICLE 1
TRUST, TRUSTEE AND TRUST FUND
1.1 TRUST. This Agreement and the Trust shall be known as the Air
Products and Chemicals, Inc. Flexible Employee Benefits Trust. The parties
intend that the Trust will be an independent legal entity with title to and
power to convey all of its assets in accordance with the terms of this
Agreement. The parties hereto further intend that the Trust not be subject to
the Employee Retirement Income Security Act of 1974, as amended. The Trust is
not a part of any of the Plans and does not provide pension, welfare or any
other benefits to any Plan Participant (as herein defined). The assets of the
Trust will be held, invested and disposed of by the Trustee in accordance with
the terms of the Trust. No Plan Participant nor any Plan shall have any
preferred claim on, or any beneficial ownership interest in, any assets of the
Trust.
1.2 TRUSTEE. The trustee named above, and its successor or
successors, is hereby designated as the trustee hereunder, to receive, hold,
invest, administer and distribute the Trust Fund in accordance with this
Agreement, the provisions of which shall govern the powers, duties and
responsibilities of the Trustee.
1.3 TRUST FUND. On the date of execution of this Agreement, the
Company shall sell to the Trustee for holding under the Trust ten million
(10,000,000) shares of Company Stock pursuant to that certain Common Stock
Purchase Agreement, dated of even date herewith, between the Company and the
Trustee. The Committee shall direct the Trustee to enter into the Common Stock
Purchase Agreement and shall be solely responsible for the terms thereof. The
assets held at any time and from time to time under the Trust collectively are
herein referred to as the "Trust Fund" and shall consist of contributions
received by the Trustee, proceeds of any loans, investments and reinvestment
thereof, the earnings and income thereon, less disbursements therefrom. Except
as herein otherwise provided, title to the assets of the Trust Fund shall at
all times be vested in the Trustee and securities that are part of the Trust
Fund shall be held in such manner that the Trustee's name and the fiduciary
capacity in which the securities are held are fully disclosed, subject to the
right of the Trustee to hold title in bearer form or in the name of a nominee,
and the interests of the Company in the Trust Fund shall be only the right to
have such assets received, held, invested, administered and distributed in
accordance with the provisions of the Trust.
1.4 TRUST FUND SUBJECT TO CLAIMS. Notwithstanding any provision
of this Agreement to the contrary, the Trust Fund shall at all times remain
subject to the claims of the Company's general creditors under federal and
state law in the event of the Company's Insolvency (as herein defined).
In addition, the Board of Directors and Chief Executive
Officer of the Company shall have the duty to inform the Trustee in writing of
the Company's
<PAGE> 6
Insolvency (as herein defined). If a person claiming to be a creditor of the
Company alleges in writing to the Trustee that the Company has become
Insolvent, the Trustee shall determine whether the Company is Insolvent and,
pending such determination, the Trustee shall discontinue transfers of Released
Shares pursuant to Article 3.
Unless the Trustee has actual knowledge of the Company's
Insolvency, or has received notice from the Company or a person claiming to be
a creditor alleging that the Company is Insolvent, the Trustee shall have no
duty to inquire whether the Company is Insolvent. The Trustee may in all
events rely on such evidence concerning the Company's solvency as may be
furnished to the Trustee by the Company or any other reliable source and that
provides the Trustee with a reasonable basis for making a determination
concerning the Company's Insolvency.
If at any time the Trustee has determined that the Company is
Insolvent, the Trustee shall discontinue transfers of Released Shares pursuant
to Article 3 and shall hold the Trust Fund for the benefit of the Company's
general creditors. Nothing in this Agreement shall in any way diminish any
rights of employees as general creditors of the Company with respect to
benefits due under the Plan(s) or otherwise.
The Trustee shall resume transfers of Released Shares pursuant
to Article 3 only after the Trustee has determined that the Company is not
Insolvent (or is no longer Insolvent).
Notwithstanding anything herein to the contrary, in the event
that the Company is Insolvent, the Committee may, in its discretion, to the
extent permitted by applicable law, direct the Trustee to apply the Trust Fund
to satisfy the claims of the Company's creditors.
1.5 DEFINITIONS. In addition to the terms defined in the
preceding portions of this Agreement, certain capitalized terms have the
meanings set forth below:
Board of Directors. "Board of Directors"' means the board of
directors of the Company, a committee comprised of members thereof or a
committee formed pursuant to a resolution of the Board.
Code. "Code" means the Internal Revenue Code of 1986, as
amended.
Committee. "Committee" means the person holding the title of
Treasurer of the Company or any other officer of the Company who is charged by
the Board of Directors with administration of the Trust pursuant to this
Agreement.
Company. "Company" means Air Products and Chemicals, Inc., a
Delaware corporation, or any successor thereto. Reference to the Company shall
include its subsidiaries where appropriate.
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Company Stock. "Company Stock" means shares of common stock,
par value $1.00 per share, issued by the Company, or any successor securities
thereto.
Extraordinary Dividend. "Extraordinary Dividend" means any
dividend or other distribution of cash or other property (other than Company
Stock) made with respect to Company Stock, which the Board of Directors
declares generally to be other than an ordinary dividend.
Insolvency or Insolvent. "Insolvency" or being "Insolvent"
means (i) the inability of the Company to pay its debts as they become due, or
(ii) the Company being subject to a pending proceeding as a debtor under the
provisions of Title 11 of the United States Code (Bankruptcy Code).
Loan. "Loan" means the loan and extension of credit to the
Trust evidenced by the promissory note made by the Trustee of even date
herewith, with which the Trustee purchased Company Stock from the Company.
Plan Participant. "Plan Participant" means a participant in
or beneficiary under any of the Plans.
Plans. "Plans" means the employee plans, programs, contracts
and compensation structures listed on Schedule A hereto, together with all
similar, succeeding or other plans, programs, contracts or structures for
compensating employees hereafter adopted by the Company.
Savings Plan. "Savings Plan" means the Air Products and
Chemicals, Inc. Retirement Savings and Stock Ownership Plan or, if such plan
ceases to exist, any other broad based employee benefit plan of the Company as
designated by the Committee.
Savings Plan Trustee. "Savings Plan Trustee" means Wachovia
Bank of North Carolina, N.A., in its capacity as the trustee of the Savings
Plan, or any successor trustee thereto, the name and address of such entity
and the appropriate representative thereof to be from time to time provided to
the Trustee by the Committee. Additionally, the Committee shall provide a copy
of Section 5.4 of this Agreement to the Savings Plan Trustee.
Trustee. "Trustee" means Mellon Bank (DE) National
Association (not in its corporate capacity but as trustee of the Trust), or any
successor trustee of the Trust.
Trust Year. "Trust Year" means the period beginning on the
date hereof and ending on September 30, 1994, and each 12 month period
beginning on October 1 and ending on September 30 thereafter.
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ARTICLE 2
CONTRIBUTIONS AND DIVIDENDS
2.1 CONTRIBUTIONS. For each Trust Year, the Company shall
contribute to the Trust in cash such amount, which together with dividends, as
provided in Section 2.3, and any other earnings of the Trust, shall enable the
Trustee to make all payments of principal and interest due under the Loan on a
timely basis. Unless otherwise expressly provided herein, the Trustee shall
apply all such contributions, dividends and earnings to the payment or
prepayment of principal and interest due under the Loan. If, at the end of any
Trust Year, insufficient contributions have been made in cash, such
contributions shall be deemed to have been made in the form of forgiveness of
principal and interest on the Loan to the extent of the Company's failure to
make contributions as required by this Section 2.1. Such forgiveness shall be
the sole and absolute remedy that the Trust shall have against the Company for
any failure to make any contribution to the Trust. All contributions made
under the Trust shall be delivered to the Trustee. The Trustee shall be
accountable for all contributions received by it, but shall have no duty to
require any contributions to be made to it.
The Company in its sole discretion may at any time, or from
time to time, make additional deposits or contributions of cash or other
property acceptable to the Trustee to be held under the Trust by the Trustee to
augment the principal to be held, administered and disposed of by Trustee as
provided in this Agreement. Neither the Trustee nor any Plan, Plan
administrator or other third party shall have any right to compel such
additional deposits or contributions.
2.2 PREPAYMENTS. The Company may, from time to time, contribute
cash to the Trust in amounts sufficient to enable the Trust to prepay, in whole
or in part, principal (and interest accrued thereon to the date of prepayment)
of the Loan at any time without premium or penalty or, in lieu of such
prepayment, the Committee may, from time to time, direct that all or any part
of such principal (and interest accrued thereon) shall be forgiven and the
payment so directed shall be forgiven. Each such prepayment of principal shall
be applied to reduce installments of principal thereafter due on the Loan in
the order of their scheduled maturities.
2.3 DIVIDENDS. Except as otherwise provided herein, dividends
paid in cash on Company Stock held by the Trust (including dividends paid on
Released Shares, as defined below, that have not been transferred out of the
Trust at the time of such dividend payment) shall be applied, immediately upon
receipt thereof by the Trustee, (i) first to interest accrued and unpaid as of
the date of any such payment and then, (ii) to the extent that any such payment
exceeds such accrued and unpaid interest, to prepay interest that accrues after
such payment through the end of such Trust Year, and then (iii) to pay
principal installments due within such Trust Year, and then, (iv) to
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the extent not otherwise distributed in accordance with the next sentence, to
additional installments of principal in the order of their scheduled maturity.
In the event that dividends paid on Company Stock held in the Trust, other than
Extraordinary Dividends, exceed the amount of scheduled principal and interest
due in any Trust Year, such excess shall, as determined by the Committee, be
(i) applied to prepay, in whole or in part, principal (and accrued interest
thereon to the date of such prepayment) of the Loan or (ii) distributed to the
Plans and/or to any other broad cross section of non-collectively bargained
employees of the Company in payment of obligations of the Company to such
employees. Extraordinary Dividends shall not be used to pay interest on or
principal of the Loan, but shall be invested in additional Company Stock as
soon as practicable, except as provided in the last sentence of this Section
2.3. Dividends which are not paid in cash or in Company Stock (including
Extraordinary Dividends, or portions thereof) shall be reduced to cash by the
Trustee and reinvested in Company Stock as soon as practicable, except as
provided in the last sentence of this Section 2.3. Company Stock purchased
with the proceeds of an Extraordinary Dividend or with the proceeds of a non-
cash dividend shall, for purposes of this Agreement (including, without
limitation, Section 3.1 hereof), be deemed to have been acquired with the
proceeds of the Loan. Investments in Company Stock may be made through
open-market purchases, private transactions or (with the Company's consent)
purchases from the Company, as directed by the Committee. The Committee may
also direct the Trustee as to the timing and manner of such purchases in order
to comply with applicable law and to avoid, if possible, adverse effects on the
publicly traded market price of Company Stock.
ARTICLE 3
RELEASE AND TRANSFER OF COMPANY STOCK AND CASH PROCEEDS
3.1 COMPANY STOCK MADE AVAILABLE FOR TRANSFER FROM TRUST.
Immediately after each payment, pre-payment or forgiveness, if any, of
principal (and accrued interest thereon) of the Loan is made, a number of
shares of Company Stock shall be made available for transfer from the Trust
("Released Shares") in the manner set forth in Section 3.2. The number of such
Released Shares shall equal the number of shares of Company Stock held in the
Trust immediately prior to such payment, prepayment or forgiveness that have
not already been deemed Released Shares pursuant to a previous payment,
prepayment or forgiveness of principal of the Loan, multiplied by a fraction,
the numerator of which shall be the amount of principal paid or prepaid or
deemed forgiven upon such payment or prepayment date or date of forgiveness and
the denominator of which shall be the sum of the numerator plus the principal
amount of the Loan remaining after such payment, prepayment or forgiveness. No
fractional shares shall be released. If the preceding computation results in
fractional shares, the number of Released Shares shall be computed by rounding
down to the next whole
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number. The number of Released Shares, determined as aforesaid, shall be
certified to the Trustee by the Committee.
3.2 TRANSFER FROM TRUST OF RELEASED SHARES AND CASH PROCEEDS.
Released Shares shall be transferred by the Trustee, and/or sold by the Trustee
to obtain cash for transfer, to such Plans as the Committee shall direct and as
shall be required to provide Company Stock and/or cash to such Plans in
accordance with the current requirements of such Plans for Company Stock and/or
cash. To facilitate any such sales of Released Shares, the Company shall
register under the Securities Act of 1933, as amended (the "1933 Act"), such
number of Released Shares as the Committee may direct. The Trustee shall have
no obligation to sell the Company stock until such registration is complete.
If Released Shares remain in the Trust after the transfers or sales
described above, the Committee will provide directions so as to assure that no
such remaining Released Shares will be held for more than four (4) years after
they become "Released Shares", and such remaining Released Shares may, as the
Committee shall direct, (i) be transferred to, or used by the Trustee for the
benefit of, the Plans or such other employee benefit plans (or their
participants and beneficiaries) covering a broad cross section of
non-collectively bargained employees of the Company or its subsidiaries as the
Committee shall direct, or (ii) be retained in the Trust for a sufficient
period of time after the release of such shares so that such Released Shares
may be sold by the Trustee in accordance with Rule 144 under the 1933 Act, if
such exemption from registration requirements is available, at such times as
the Committee may direct.
The Committee may direct the Trustee as to the timing and manner of
sales of Released Shares pursuant to this Section 3.2 in order to comply with
applicable law and to avoid, if possible, adverse effects on the publicly
traded market price of Company Stock. If the Trustee is required to sell
Company Stock, the Trustee may engage agents to effect such sales and shall be
reimbursed for the reasonable fees and expenses of such agents in accordance
with Section 4.1. Released Shares and cash proceeds from the sale of Released
Shares to be transferred to Plans with respect to which trusts have been
established shall be delivered to the trustee thereof; and if there is no such
trust with respect to a Plan, the shares or cash to be transferred to such Plan
shall be delivered to the plan administrator of such Plan, to third party
service providers for such Plan or to such other person as the Committee shall
direct.
The references to the Plans in this Agreement shall not cause the
Plans to become irrevocable and the Company retains sole discretion to modify
or amend any of the provisions of the Plans or to terminate any or all of them
to the extent provided therein and/or as permitted by applicable law.
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ARTICLE 4
COMPENSATION, EXPENSES AND TAX WITHHOLDING
4.1 COMPENSATION AND EXPENSES. The Trustee shall be entitled to
such reasonable compensation for its services and to be reimbursed for its
reasonable legal, accounting and appraisal fees, expenses and other charges
reasonably incurred in connection with the administration, management,
investment and distribution of the Trust Fund, all as may be agreed upon from
time to time by the Company and the Trustee. Such compensation shall be paid,
and such reimbursement shall be made, out of the Trust Fund. The Company
agrees to make sufficient contributions to the Trust to pay such amounts owing
the Trustee in addition to those contributions required by Section 2.1. In the
event the Company fails to make the contributions necessary to pay compensation
and expenses owing to the Trustee, as contemplated by this Section 4.1, the
Trustee shall be entitled to seek payment of such compensation and expenses
directly from the Company.
4.2 WITHHOLDING OF TAXES. The Trustee shall report and withhold
any federal, state or local taxes that it is required by law or is instructed
by the Committee to withhold from any payments, transfers, or distributions it
makes pursuant to this Agreement and shall pay over amounts withheld to the
appropriate taxing authorities.
ARTICLE 5
ADMINISTRATION OF TRUST FUND
5.1 MANAGEMENT AND CONTROL OF TRUST FUND. Subject to the terms of
this Agreement, the Trustee shall have exclusive authority, discretion and
responsibility to manage and control the assets of the Trust Fund; provided,
however, that the situs of the Trust Fund shall at all times remain in the
State of Delaware and the Trustee shall maintain all records pertaining to the
Trust and all indicia of ownership of Trust Fund assets at its office(s) in
Delaware.
5.2 INVESTMENT OF FUNDS. Except as otherwise provided in Section
2.3 and in this Section 5.2, the Trustee shall invest and reinvest the Trust
Fund exclusively in Company Stock, including any accretions thereto resulting
from the proceeds of a tender offer, recapitalization or similar transaction
which, if not in Company Stock, shall be reduced to cash as soon as
practicable. Unless directed otherwise by the Committee, the Trustee may
invest any portion of the Trust Fund temporarily pending investment in Company
Stock, distribution or payment of expenses in (i) investments in United States
Government obligations with maturities of less than one year, (ii)
interest-bearing accounts including but not limited to certificates of deposit,
time
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deposits, saving accounts and money market accounts with maturities of less
than one year in any bank, including the Trustee's, with aggregate capital in
excess of $1,000,000,000 and a Moody's Investors Service rating of at least P1,
or an equivalent rating from a nationally recognized ratings agency, which
accounts are insured by the Federal Deposit Insurance Corporation or other
similar federal agency, (iii) obligations issued or guaranteed by any agency or
instrumentality of the United States of America with maturities of less than
one year, (iv) short-term discount obligations of the Federal National Mortgage
Association, or (v) open-end and closed-end investment companies or a common,
collective, or pooled trust fund maintained by any corporate Trustee hereunder
whose investments are substantially similar to those described in (i), (ii),
(iii) and/or (iv) of this paragraph, in which event such part of the Trust Fund
so transferred shall be subject to all the terms and provisions of the common,
collective, or pooled trust fund which contemplate the commingling for
investment purposes of such trust assets with trust assets of other trusts.
The Company expressly understands and agrees that any such collective fund may
provide for the lending of its securities by the collective fund trustee and
that such collective fund's trustee will receive compensation from the fund for
the lending of securities that is separate from compensation it may receive as
Trustee under this Agreement.
5.3 TRUSTEE'S ADMINISTRATIVE POWERS. Except as otherwise provided
herein, and subject to the Trustee's duties hereunder, the Trustee shall have
the following powers and rights, in addition to those provided elsewhere in
this Agreement or by law:
(a) to retain any asset of the Trust Fund for the
purposes set forth herein;
(b) subject to Section 2.3, Article 3, Section 5.2,
Section 5.4 and Section 8.3, to sell, transfer, mortgage, pledge, lease or
otherwise dispose of, or grant options with respect to, any Trust Fund assets
at public or private sale;
(c) upon direction from the Committee, to borrow from any
lender (including the Company pursuant to the Loan), to acquire Company Stock
as authorized by this Agreement, to enter into loan agreements upon such terms
(including reasonable interest and security for the loan and rights to
renegotiate and prepay such loan) as may be determined by the Committee;
provided, however, that any collateral given by the Trustee for the Loan shall
be limited to cash and property contributed by the Company to the Trust and
dividends paid on Company Stock held in the Trust Fund and shall not include
Company Stock acquired with the proceeds of the Loan;
(d) with the consent of the Committee, to settle, submit
to arbitration, compromise, contest, prosecute or abandon claims and demands in
favor of or against
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the Trust Fund; provided, however, that, subject in particular to the
provisions of Section 2.1 above, the Trustee shall be entitled to act in its
own discretion in such matters should it deem it necessary to protect the Trust
Fund from default or immediate loss;
(e) to vote or to give any consent with respect to any
securities, including any Company Stock, held by the Trust either in person or
by proxy for any purpose, provided that the Trustee shall vote, tender or
exchange all shares of Company Stock only as provided in Section 5.4;
(f) to exercise any of the powers and rights of an
individual owner with respect to any asset of the Trust Fund and to perform any
and all other acts that in its judgment are necessary or appropriate for the
proper administration of the Trust Fund, even though such powers, rights and
acts are not specifically enumerated in this Agreement;
(g) to cause any asset of the Trust Fund to be issued,
held or registered in the Trustee's name or in the name of its nominee, or in
such form that title will pass by delivery, provided that the records of the
Trustee shall indicate the true ownership of such asset;
(h) to utilize another entity as custodian to hold, but
not invest or otherwise manage or control, some or all of the assets of the
Trust Fund; and
(i) to consult with legal counsel (who may also be
counsel for the Trustee or the Company generally) with respect to any of its
duties or obligations hereunder; and to pay the reasonable fees and expenses of
such counsel, which shall be deemed to be expenses of the Trust and for which
the Trustee shall be reimbursed in accordance with Section 4.1.
Notwithstanding any power granted to the Trustee pursuant to the foregoing or
under applicable law, neither the Trust nor the Trustee shall have any power
to, and shall not, engage in any trade or business, and, in particular, the
Trustee shall not have any power that could give the Trust the objective of
carrying on a business and dividing the gains therefrom, within the meaning of
Section 301.7701-2 of the Procedures and Administrative Regulations promulgated
pursuant to the Code.
5.4 RIGHTS REGARDING COMPANY STOCK.
(a) Voting Rights. The Trustee shall follow the
directions of the Savings Plan participants with respect to the manner of
voting of Company Stock held by the Trust on each matter pending before an
annual or special meeting of stockholders of the Company or any action by
written consent of such stockholders
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in lieu of a meeting. In connection with any such meeting of stockholders or
action by written consent in lieu of a meeting, the Trustee shall obtain from
the Savings Plan Trustee certification of the directions received from the
Savings Plan participants (in the aggregate and not identifying any individual
direction) directing the Saving Plan Trustee whether and how to vote, abstain
or act by written consent with respect to, the Company Stock held by the
Savings Plan. Upon receipt by the Trustee of such certification, the Trustee
shall, on each such matter, vote, abstain or act by written consent with
respect to the shares of Company Stock held by the Trust in the same proportion
and manner as the Savings Plan participants directed the Savings Plan Trustee
with respect to the Company Stock held by the Savings Plan.
(b) Tender or Exchange Offer. If a tender or exchange
offer is commenced for Company Stock, the Trustee shall obtain from the Savings
Plan Trustee certification of the directions received from the Savings Plan
participants directing the Savings Plan Trustee whether to tender or exchange
the Company Stock held by the Savings Plan. Upon receipt by the Trustee of
such certification, the Company Stock held by the Trust shall be tendered or
exchanged, or not tendered or exchanged, by the Trustee in the same proportion
and manner as the Savings Plan participants directed the Savings Plan Trustee
with respect to the Company Stock held by the Savings Plan.
(c) Confidentiality. All voting and other actions taken
pursuant to the foregoing paragraphs 5.4(a) and 5.4(b), and the contents of any
certification of directions received by the Savings Plan Trustee as
contemplated by such paragraphs 5.4(a) and 5.4(b), shall be held confidential
by the Trustee and shall not be divulged or released to any person, including
officers and employees of the Company and its affiliates (other than (i) agents
of the Trustee who are not affiliated with the Company or its affiliates or
(ii) by virtue of the execution by the Trustee of any proxy, consent or letter
of transmittal for the shares of Company Stock held in the Trust).
(d) Trustee Action. The Trustee shall not make any
recommendations regarding the manner of exercising any rights under this
Section 5.4, including whether or not any rights should be exercised.
5.5 INDEMNIFICATION.
(a) To the extent lawfully allowable, the Company hereby
indemnifies the Trustee against, and agrees to hold the Trustee harmless from,
all losses, claims, damages and liabilities ("Losses"), including reasonable
attorneys' fees and expenses in defending against same, asserted against the
Trustee as a result of (i) the performance by the Trustee of its duties
hereunder, (ii) any action taken or failure to act by the Trustee pursuant to
written direction (or lack of direction where one is required) of the Company
or Committee, or (iii) any action, proceeding or claim by any
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regulatory agency or other person with respect to the establishment or
operation of this Trust, except for any Loss which is a result of negligence or
willful misconduct by the Trustee or the Trustee's failure to abide by the
terms of this Agreement or applicable trust law. The Trustee shall be fully
protected in acting upon any instrument, certificate or paper delivered by the
Committee or the trustee or administrator of any Plan and believed in good
faith by the Trustee to be genuine and to be signed or presented by the proper
person or persons, and the Trustee shall be under no duty to make any
investigation or inquiry as to any statement contained in any such writing, but
may accept the same as conclusive evidence of the truth and accuracy of the
statements therein contained.
(b) The Company shall have the right to elect to defend
any action, claim or proceeding in respect of Losses for which the Trustee is
entitled to be indemnified under paragraph 5.5(a) ("Action"). If the Company
so elects or is requested by the Trustee, the Company will (and shall be
entitled to) assume the defense of the Trustee in any Action, including the
selection of counsel (reasonably satisfactory to the Trustee), and assume the
payment of all counsel fees and all other expenses relating to such defense,
including any legal or other expenses reasonably incurred by the Trustee in
connection with investigating any such Losses prior to the assumption of the
defense by the Company; provided, however, that (i) if the Company fails to
assume the defense of any Action in a timely manner, or if common counsel
reasonably determines that its representation of the Trustee and the Company
would present such counsel with any conflict of interest, then the Trustee may
employ separate counsel to represent or defend it in any such Action and the
Company will pay the fees and disbursements of such counsel and (ii) the
Trustee may retain separate counsel in any Action, including any Action as to
which the Company has assumed the defense, and participate in the defense
thereof at the Trustee's expense unless such retention of separate counsel has
been specifically authorized by Company. The Company shall not be liable for
any settlement of any action or proceeding effected without its consent (such
consent not to be unreasonably withheld) prior to final adjudication thereof,
and the Company shall not agree to the settlement of any Action against the
Trustee without the consent of the Trustee, which consent shall not be
unreasonably withheld.
(c) The Company may, but shall not be required to,
maintain liability insurance to insure its obligations hereunder. If any
payments made by the Company or the Trust pursuant to this indemnity are
covered by insurance, the Company or the Trust (as applicable) shall be
subrogated to the rights of the indemnified party against the insurance
company.
5.6 GENERAL DUTY TO COMMUNICATE TO COMMITTEE. The Trustee shall
promptly notify the Committee of all communications with or from any government
agency or with respect to any legal proceeding with regard to the Trust and
with or
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from any Plan Participants concerning their alleged entitlements under the
Plans or the Trust.
ARTICLE 6
ACCOUNTS AND REPORTS OF TRUSTEE
6.1 RECORDS AND ACCOUNTS OF TRUSTEE. The Trustee shall maintain
accurate and detailed records and accounts of all transactions of the Trust,
which shall be available at all reasonable times for inspection or audit by any
person designated by the Company and which shall be retained as required by
applicable law.
6.2 FISCAL YEAR. The fiscal year of the Trust shall be the twelve
month period beginning on October 1 and ending on September 30.
6.3 REPORTS OF TRUSTEE. Within thirty (30) days following the
close of each fiscal year of the Trust and each quarter of each fiscal year of
the Trust, the Trustee shall prepare and present to the Committee a report for
the period ending on the last day of such fiscal year and/or quarter of such
fiscal year, as the case may be, listing all securities and other property
acquired or disposed of and all receipts, disbursements and other transactions
effected by the Trust during such period and further listing all cash,
securities, and other property held by the Trust, together with the fair market
value thereof, as of the end of such period. In addition to the foregoing, the
report shall contain such information regarding the Trust Fund's assets and
transactions as the Committee in its discretion may reasonably request. The
Trustee shall also prepare and present to the Committee such reports for other
periods as the Committee may reasonably request. Except as otherwise provided
in the next sentence, all tax returns and other regulatory filings required by
the Trust shall be prepared by the Trustee and submitted to the Committee for
the Company's review at least thirty (30) days before the due date (including
any extension thereof) for filing such tax return or other regulatory filing.
The Company may, upon written notice to the Trustee, assume the responsibility
for preparing any tax return or other regulatory filing required by the Trust.
The Trustee shall timely file all such tax returns and other regulatory filings
as shall be directed by the Company and shall promptly provide copies of such
filings to the Committee.
6.4 FINAL REPORT. In the event of the resignation or removal of a
Trustee hereunder, the Trustee shall with reasonable promptness submit, for the
period ending on the effective date of such resignation or removal, a report
similar in form and purpose to that described in Section 6.3. The Committee
shall review such final report and its written approval thereof will discharge
the Trustee for all transactions reflected in such report.
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6.5 VALUATION OF COMPANY STOCK FOR PURPOSES OF REPORTS, TAX
RETURNS AND FILINGS. The Trustee shall value shares of Company Stock at its
fair market value for purposes of preparing the reports, tax returns and
filings contemplated by this Article 6. Fair market value shall mean for this
purpose the closing price of a share of Company Stock on the trading day
immediately preceding the date as of which said value is to be presented in
such report, tax return or filing, as reported in the Wall Street Journal on
the composite tape for issues listed on the New York Stock Exchange.
ARTICLE 7
SUCCESSION OF TRUSTEE
7.1 RESIGNATION OF TRUSTEE. The Trustee or any successor thereto
may resign as Trustee hereunder at any time upon delivering a written notice of
such resignation, to take effect 60 days after the delivery thereof to the
Committee, unless the Committee accepts shorter notice; provided, however, that
no such resignation shall be effective until a successor Trustee has assumed
the office of Trustee hereunder.
7.2 REMOVAL OF TRUSTEE. The Trustee or any successor thereto may
be removed by the Company by delivering to the Trustee so removed an instrument
executed by the Committee. Such removal shall take effect at the date
specified in such instrument, which shall not be less than 60 days after
delivery of the instrument, unless the Trustee accepts shorter notice;
provided, however, that no such removal shall be effective until a successor
Trustee has assumed the office of Trustee hereunder.
7.3 APPOINTMENT OF SUCCESSOR TRUSTEE. Whenever the Trustee or any
successor thereto shall resign or be removed or a vacancy in the position shall
otherwise occur, the Committee shall use its best efforts to appoint a
successor Trustee as soon as practicable after receipt by the Committee of a
notice described in Section 7.1, or the delivery to the Trustee of a notice
described in Section 7.2, as the case may be, but in no event more than 60 days
after receipt or delivery, as the case may be, of such notice. A successor
Trustee's appointment shall not become effective until such successor shall
accept such appointment by delivering its acceptance in writing to the Company.
If a successor is not appointed within such 60 day period, the Trustee, at the
Company's expense, may petition a court of competent jurisdiction for
appointment of a successor. In any event only a corporation with trust powers
under applicable law, which is not an affiliate of the Company, may be a
successor trustee hereunder.
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7.4 SUCCESSION TO TRUST FUND ASSETS. The title to all property
held hereunder shall vest in any successor Trustee acting pursuant to the
provisions hereof without the execution or filing of any further instrument,
but a resigning or removed Trustee shall execute all instruments and do all
acts necessary to vest title in the successor Trustee. Each successor Trustee
shall have, exercise and enjoy all of the powers, both discretionary and
ministerial, herein conferred upon its predecessors. A successor Trustee shall
not be obliged to examine or review the accounts, records, or acts of, or
property delivered by, any previous Trustee and shall not be responsible for
any action or any failure to act on the part of any previous Trustee.
7.5 CONTINUATION OF TRUST. In no event shall the legal
disability, resignation or removal of a Trustee terminate the Trust, but the
Committee shall forthwith appoint a successor Trustee in accordance with
Section 7.3 to carry out the terms of the Trust.
7.6 CHANGES IN ORGANIZATION OF TRUSTEE. In the event that any
corporate Trustee hereunder shall be converted into, shall merge or consolidate
with, or shall sell or transfer substantially all of its assets and business
to, another corporation, state or federal, the corporation resulting from such
conversion, merger or consolidation, or the corporation to which such sale or
transfer shall be made, shall thereafter become and be the Trustee under the
Trust with the same effect as though originally so named but only if such
corporation is qualified to be a successor trustee hereunder.
7.7 CONTINUANCE OF TRUSTEE'S POWERS IN EVENT OF TERMINATION OF THE
TRUST. In the event of the termination of the Trust, as provided herein, the
Trustee shall dispose of the Trust Fund in accordance with the provisions
hereof. Until the final distribution of the Trust Fund, the Trustee shall
continue to have all powers provided hereunder as necessary or expedient for
the orderly liquidation and distribution of the Trust Fund.
ARTICLE 8
AMENDMENT OR TERMINATION
8.1 AMENDMENTS. Except as otherwise provided herein, the Company
may amend the Trust at any time and from time to time in any manner which it
deems desirable, provided, however:
(a) no amendment that would adversely affect the
contingent rights of beneficiaries of the Trust may change:
- 15 -
<PAGE> 19
(i) the formula for computing the number of
Released Shares contained in Section 3.1 so as to change the
number of Released Shares in any Trust Year;
(ii) the terms of Sections 2.1, 2.3, 3.2, 5.4,
8.1, 8.2 or 8.3; and
(b) no amendment may change the duties of the Trustee
without the Trustee's consent, which consent shall not be unreasonably
withheld.
Notwithstanding the foregoing, the Company, acting in good
faith taking into account the best interests of a broadly based population of
individuals employed by the Company or broadly based employee benefit plans in
which such persons participate, shall retain the power under all circumstances
to amend the Trust to add employee benefit plans to, or delete Plans from,
Schedule A and to clarify any ambiguities or similar issues of interpretation
in this Agreement.
8.2 TERMINATION. The Trust shall terminate upon the earlier of (i)
September 30, 2023 or (ii) the date on which the Trust no longer holds any
assets. The Company, acting through a duly-authorized officer, may terminate
the Trust at any time prior to the date the Trust terminates pursuant to the
preceding sentence.
8.3 EFFECT OF TERMINATION. Upon termination of the Trust, the
Trustee shall sell sufficient remaining assets of the Trust so that the
proceeds of such sale, together with any other available cash, can be applied
to pay in full the remaining principal of the Loan and any accrued but unpaid
interest thereon and any expenses of the Trust. The Committee may direct the
Trustee as to the timing and manner of such sale in order to comply with
applicable law and to avoid, if possible, adverse effects on the publicly
traded market price of Company Stock. If the Trustee is required to sell
Company Stock the Trustee may engage agents to effect such sales and shall be
reimbursed for the reasonable fees and expenses such agents in accordance with
Section 4.1. In the event the proceeds of the sale shall be insufficient to
discharge the Loan in its entirety, the Company shall be deemed to have
forgiven all amounts which shall remain due and owing thereon. Any assets or
Company Stock remaining in the Trust after such payment in full of the Loan
shall be distributed to or for the benefit of any employee benefit plan
(including one or more of the Plans) in which a broad cross section of
non-collectively bargained employees of the Company participate, as the
Committee shall, in its sole discretion, determine.
8.4 MERGER. If the Company is merged into another corporation or
another corporation is merged into the Company then (a) the surviving
corporation shall become the grantor of the Trust, (b) the assets of the Trust
shall be subject to the claims of the creditors of the surviving corporation in
accordance with Article 1, above and (c) the provisions of this Agreement which
apply to Company Stock (including
- 16 -
<PAGE> 20
without limitation the provisions of Article 3, above) shall apply to the stock
of the surviving corporation held hereunder or transferred to the Trust.
8.5 FORM OF AMENDMENT OR TERMINATION. Any amendment or
termination of the Trust shall be evidenced by an instrument in writing signed
by an authorized officer of the Company, certifying that said amendment or
termination has been authorized and directed by the Company or the Board of
Directors, as applicable.
ARTICLE 9
MISCELLANEOUS
9.1 CONTROLLING LAW. The laws of the State of Delaware shall be
the controlling law in all matters relating to the Trust, without regard to
conflicts of law.
9.2 COMMITTEE ACTION. Any action required or permitted to be
taken by the Committee may be taken on behalf of the Committee by any
individual so authorized. The Company shall furnish to the Trustee the name
and specimen signature of each member of the Committee upon whose statement of
a decision or direction the Trustee is authorized to rely. Until notified of a
change in the identity of such person or persons, the Trustee shall act upon
the assumption that there has been no change.
9.3 NOTICES. All notices, requests, or other communications
required or permitted to be delivered hereunder shall be in writing, delivered
by registered or certified mail, return receipt requested, telecopier,
overnight courier or hand delivery as follows:
To the Company: Air Products and Chemicals, Inc.
7201 Hamilton Boulevard
Allentown, PA 18195-1501
Attention: Treasurer
To the Trustee: Mellon Bank (DE) National Association
Mellon Bank Center
10th and Market Streets, 2nd Floor
Wilmington, DE 19001
Attention: Sandy S. McKenna,
Assistant Vice President
Any party hereto may from time to time, by written notice given as aforesaid,
designate any other address to which notices, requests or other communications
addressed to it shall be sent.
- 17 -
<PAGE> 21
9.4 SEVERABILITY. If any provision of the Trust shall be held
illegal, invalid or unenforceable for any reason, such provision shall not
affect the remaining parts hereof, but the Trust shall be construed and
enforced as if said provision had never been inserted herein.
9.5 PROTECTION OF PERSONS DEALING WITH THE TRUST. No person
dealing with the Trustee shall be required or entitled to monitor the
application of any money paid or property delivered to the Trustee, or
determine whether or not the Trustee is acting pursuant to authorities granted
to it hereunder or to authorizations or directions herein required.
9.6 TAX STATUS OF TRUST. The Trust is intended to be a grantor
trust, of which the Company is the grantor, within the meaning of subpart E,
part I, subchapter J, chapter 1, subtitle A of the Code, and shall be construed
accordingly. Until advised otherwise, the Trustee may presume that the Trust
is so characterized for federal income tax purposes and shall make all filings
of tax returns on that presumption.
9.7 NO THIRD PARTY RIGHTS; PARTICIPANTS TO HAVE NO INTEREST IN THE
COMPANY BY REASON OF THE TRUST. Neither this Agreement nor the Trust shall
confer upon any person other than the parties hereto any rights, remedy or
claim with respect to the assets of the Trust or otherwise. Neither the
creation of the Trust nor anything contained in the Trust shall be construed as
giving any person, including any individual employed by the Company or any
subsidiary of the Company, any equity or interest in the assets, business or
affairs of the Company.
9.8 NONASSIGNABILITY. No right or interest, if any, of any person
to receive distributions from the Trust shall be assignable or transferable, in
whole or in part, either directly or by operation of law or otherwise,
including, but not by way of limitation, by execution, levy, garnishment,
attachment, pledge, or bankruptcy, but excluding death or mental incompetency,
and, to the fullest extent permitted by applicable law, no right or interest,
if any, of any person to receive distributions from the Trust shall be subject
to any obligation or liability of any such person, including claims for alimony
or the support of any spouse or child.
9.9 GENDER AND PLURALS. Whenever the context requires or permits,
the masculine gender shall include the feminine gender and the singular form
shall include the plural form and shall be interchangeable.
- 18 -
<PAGE> 22
9.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be considered an original.
IN WITNESS WHEREOF, the Company and the Trustee have caused this
Agreement to be signed, and their seals affixed hereto, by their authorized
officers all as of the day, month and year first above written.
MELLON BANK (DE) NATIONAL ASSOCIATION AIR PRODUCTS AND CHEMICALS, INC.
By: /s/ Sandy S. McKenna By: /s/ Gerald A. White
----------------------------- -----------------------------
Title: Assistant Vice President Title: Senior Vice President -
Finance
Date: December 29, 1993 Date: December 29, 1993
- 19 -
<PAGE> 23
<TABLE>
<CAPTION>
SCHEDULE A
PLAN TYPE FORMAL TITLE
<S> <C>
Incentive Plans 1990 Annual Incentive Plan (Bonus)
1990 Deferred Stock Plan (Career Shares/Deferred
Stock)
1990 Long-Term Incentive Plan (Options)
Variable Compensation Programs
Employee Health Care, Active/Retired Medical/Dental Plans
Pension Plan Contributions Pension Plan for Salaried Employees
Pension Plan for Hourly Rated Employees
401(k) Company Match and Employee Retirement Savings and Stock Ownership Plan
Contributions
Employee Life Insurance Basic Life Insurance Plan
Supplemental Executive Retirement/ APCI Supplementary Pension Plan
Savings Plans APCI Supplementary Savings Plan
Private Annuity, Consulting and Other Agreements
Vacation Vacation Program
Salary Continuation Salary Continuation
LTD Long-Term Disability Plan
Severance Plan Severance Plan and Special Severance Plan
Travel Accident Business Travel Accident Plan
Miscellaneous Matching Gifts Program
Educational Assistance Program
Adoption Assistance Program
Affiliate Plans and Programs SCWC Supplemental Retirement Plan
SCWC Medical and Dental Plans
UK Savings-Related Share Option Scheme
</TABLE>
- 20 -
<PAGE> 1
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (the "Agreement") is made this
29th day of December 1993, between Air Products and Chemicals, Inc., a
Delaware corporation (the "Seller" or the "Company") and Mellon Bank (DE)
National Association, a national banking association having corporate trust
powers under the laws of the State of Delaware, not in its individual or
corporate capacity, but solely in its capacity as trustee (the "Trustee") of
the Air Products and Chemicals, Inc. Flexible Employee Benefits Trust (the
"Trust", which is hereinafter sometimes referred to as the "Purchaser") under a
trust agreement between the Seller and the Trustee dated as of December 29,
1993 (the "Trust Agreement").
W I T N E S S E T H
WHEREAS, as contemplated by the Trust Agreement, the Purchaser is to
purchase from the Seller, and the Seller is to sell to the Purchaser, ten
million (10,000,000) shares of the Seller's Common Stock, par value $1.00 per
share (the "Common Shares"), all as more specifically provided herein;
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained herein, and subject to and on the terms and conditions
herein set forth, the parties hereto agree as follows:
ARTICLE 1
PURCHASE AND SALE OF SHARES
1.1 PURCHASE AND SALE. Subject to the terms and conditions
set forth herein, the Seller will sell to the Purchaser, and the
Purchaser will purchase from the Seller, at the Closing (as
hereinafter defined), the Common Shares, and, in consideration
for the Common Shares, the Purchaser will deliver to the Seller
the note in the form of Appendix 1 to this Agreement in the
principal amount of $457,500,000.00 (the "Note") which is the
market value of the Common Shares determined on the basis of the
closing price of the Common Shares on the trading day immediately
preceding the Closing, as reported in the Wall Street Journal on
the composite tape for issues listed on the New York Stock
Exchange.
1.2 CLOSING. The closing of the sale and purchase of the
Common Shares hereunder (the "Closing") will be held at the
offices of the Trustee at Mellon Bank Center, 10th and Market
Streets, 2nd Floor, Wilmington, Delaware 19801 at 10:00 a.m.,
on the date of execution and delivery of this Agreement by the Seller
and the Purchaser, or at such other time, date and place as may be
mutually agreed upon by the Seller and the Purchaser.
- 1 -
<PAGE> 2
1.3 DELIVERY AND PAYMENT. At the Closing, the Seller will deliver
to the Purchaser a certificate representing the Common Shares, which certificate
shall be registered in the name of the Trustee, or the name of its nominee,
against payment by the Purchaser to the Seller of the aggregate consideration
set forth in Section 1.1 therefor. The Seller will pay all stamp and other
transfer taxes, if any, that may be payable in respect of the sale and delivery
of the Common Shares.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller represents and warrants to the Purchaser as follows:
2.1 CORPORATE EXISTENCE AND AUTHORITY. The Seller (a) is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, (b) has all requisite corporate power to
execute, deliver and perform this Agreement, and (c) has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Agreement.
2.2 NO CONFLICT. The execution and delivery of this Agreement does
not, and the consummation of the transactions contemplated hereby will not
violate, conflict with or constitute a default under (a) the Seller's
certificate of incorporation or bylaws, (b) any agreement, indenture or other
instrument to which the Seller is a party or by which the Seller or its assets
are bound or (c) to the best of its knowledge, any law, regulation, order,
arbitration, award, judgment or decree applicable to the Seller.
2.3 VALIDITY. This Agreement has been duly executed and delivered
by the Seller and is a valid and binding agreement of the Seller enforceable
against the Seller in accordance with its terms, except as the enforceability
thereof may be limited by an applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other laws affecting the enforcement of
creditors' rights generally, and by general principles of equity.
2.4 THE COMMON SHARES. The Common Shares have been duly authorized
and, when sold as contemplated hereby, will be validly issued, fully-paid and
non-assessable shares of the Seller. No stockholder of the Seller has any
preemptive or other subscription right to acquire any shares of Common Stock.
The Seller will convey to the Purchaser, on the date of Closing, good and valid
title to the Common Shares free and clear of any liens, claims, security
interests and encumbrances.
2.5 LITIGATION. There are no actions, suits, proceedings,
arbitrations or investigations pending or, to the Seller's best knowledge,
threatened in any court or before any governmental agency or instrumentality or
arbitration panel or otherwise against or by the Seller which seek to or could
restrain, prohibit, rescind or declare unlawful, or result
- 2 -
<PAGE> 3
in substantial damages in respect of, this Agreement or the performance hereof
by the Seller (including, without limitation, the delivery of the Common
Shares).
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser represents and warrants to the Seller as follows:
3.1 AUTHORITY; VALIDITY. The Purchaser has full power and authority
under the Trust to execute and deliver this Agreement and the Note and to
consummate the transactions contemplated hereby. This Agreement has been duly
authorized, executed and delivered by the Trustee on behalf of the Trust and is
a valid and binding agreement of the Purchaser enforceable in accordance with
its terms, except as the enforceability thereof may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other laws affecting the enforcement of creditors' rights
generally, and by general principles of equity. The Note has been duly
authorized by the Trustee on behalf of the Trust and, upon execution and
delivery by the Trustee on behalf of the Trust, the Note will be a valid and
binding agreement of the Purchaser enforceable in accordance with its terms,
except as the enforceability thereof may be limited by any applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other laws affecting the enforcement of creditors' rights generally, and by
general principles of equity.
3.2 NO CONFLICT. The execution and delivery of this Agreement do
not, and the execution and delivery of the Note, and the consummation of the
transactions contemplated hereby and thereby will not, violate, conflict with
or constitute a default under (a) the terms of the Trust, (b) any agreement,
indenture or other instrument to which the Trust is a party or by which the
Trust or its assets may be bound or subject or (c) to the best of its
knowledge, any law, regulation, order, arbitration award, judgment or decree
applicable to the Trust.
ARTICLE 4
RESTRICTION ON DISPOSITION OF THE COMMON SHARES
4.1 RESTRICTED SECURITIES. The Purchaser acknowledges that the
Purchaser is acquiring the Common Shares pursuant to a transaction except from
registration under the Securities Act of 1933, as amended (the "1933 Act"). The
Purchaser represents, warrants and agrees that all Common Shares acquired by the
Purchaser pursuant to this Agreement are being acquired for investment without
any intention of making a distribution thereof, or of making any sale or other
disposition thereof which would be in violation of the 1933 Act or any
applicable state securities law, and that the Purchaser will not dispose of any
of the Common Shares, except that the Trustee will, from time to time, convey to
certain Plans
- 3 -
<PAGE> 4
(as defined and provided in the Trust Agreement) or sell pursuant to an
effective Registration Statement under the 1933 Act or an exemption therefrom,
a portion of the Common Shares to satisfy the obligations of the Company or
affiliate of the Company under such Plans, and except upon termination of the
Trust to the extent that the Trust then holds any Common Shares, all in
compliance with all provisions of applicable federal and state law regulating
the issuance, sale and distribution of securities and then only in compliance
with the Trust Agreement.
4.2 LEGEND. Until such time as the Common Shares are registered
pursuant to the provisions of the 1933 Act or may be sold without registration
in accordance with Rule 144 under the 1933 Act or any other exemption from
registration available under the 1933 Act, any certificate or certificates
representing the Common Shares delivered pursuant to Section 1.3 will bear a
legend in substantially the following form:
"The shares represented by this certificate have
not been registered under the Securities Act of 1933,
as amended, and may not be sold, transferred or
otherwise disposed of unless they have first been
registered under such Act or unless an exemption from
registration is available."
The Seller may place stop transfer orders against the registration or
transfer of any share evidenced by such a certificate or certificates until
such time as the requirements of the foregoing are satisfied.
ARTICLE 5
COVENANTS OF SELLER
The Seller agrees that:
5.1 COMPLIANCE AND FILINGS. The Seller will comply with all rules
of any stock exchange or similar entity which are applicable to it or to the
conduct of its business, and, without limiting the generality of the foregoing,
shall make such filings, distributions and disclosures as are required by the
1933 Act, the 1934 Act or any of the regulations, rules or orders promulgated
thereunder, insofar as the failure to comply would materially and adversely
affect the Company and its subsidiaries taken as a whole. The Seller will
maintain complete and accurate books, records and accounts in accordance with
the requirements of Section 13(b)(2) under the 1934 Act.
5.2 REGISTRATION. The Seller will, after a written request by the
Committee (as such term is defined in the Trust Agreement) to register under
the 1933 Act such number of Common Shares as the Committee may from time to
time direct, prepare for filing at the Seller's expense a registration
statement with the Securities and Exchange Commission sufficient to permit the
public offering of such Common Shares in accordance with the
- 4 -
<PAGE> 5
terms of this Agreement, and the Seller will use its best efforts in all
matters necessary or advisable to cause such registration statement to become
effective as promptly as practicable and to remain effective for a reasonable
period, all to the extent requisite to permit the sale or other disposition of
such Common Shares. The Seller shall also use its best efforts to register or
qualify the Common Shares so registered under the securities and blue sky laws
of such jurisdictions within the United States as the Trustee may request
pursuant to the written request of the Committee, provided, however, that the
Seller shall not be required to (i) consent to general service of process for
all purposes in any jurisdiction where it is not then qualified; or (ii)
qualify generally or use efforts which could cause it to qualify generally to
do business as a foreign corporation in any jurisdiction wherein it would not
otherwise be required to qualify.
ARTICLE 6
CONDITIONS TO CLOSING
6.1 CONDITIONS TO OBLIGATIONS OF PURCHASER. The obligation of the
Purchaser to purchase the Common Shares is subject to the satisfaction of the
following conditions on the date of Closing:
(a) The representations and warranties of the Seller set
forth in Article 2 hereof shall be true and correct; and if the
Closing shall occur on a date other than the date of this
Agreement, the Purchaser shall have been furnished with a
certificate, dated the date of the Closing, to such effect,
signed by an authorized officer of the Seller; and
(b) All permits, approvals, authorizations and consents of
third parties necessary for the consummation of the transactions
herein shall have been obtained, and no order of any court or
administrative agency shall be in effect which restrains or
prohibits the transactions contemplated by this Agreement, and
no suit, action or other proceeding by any governmental body or
other person shall have been instituted which questions the
validity or legality of the transactions contemplated by this
Agreement.
6.2 CONDITIONS TO OBLIGATIONS OF THE SELLER. The obligation of the
Seller to issue, sell and deliver the Common Shares to the Purchaser is subject
to the satisfaction of the following conditions on the date of Closing;
(a) The representations and warranties of the Purchaser set
forth in Article 3 hereof shall be true and correct; and if the
Closing shall occur on a date other than the date of this
Agreement, the Seller shall have been furnished with a
certificate dated the date of the Closing, to such effect,
signed by an authorized officer of the Trustee; and
- 5 -
<PAGE> 6
(b) No order of any court or administrative agency shall be
in effect which restrains or prohibits the transactions
contemplated by this Agreement, and no suit, action or other
proceeding by any governmental body or other person shall have
been instituted which questions the validity or legality of the
transactions contemplated by this Agreement.
ARTICLE 7
MISCELLANEOUS
7.1 EXPENSES. The Seller shall pay all of its expenses, and it
shall pay the Purchaser's expenses, in connection with the authorization,
preparation, execution and performance of this Agreement, including, without
limitation, the reasonable fees and expenses of the Trustee, its agents,
representatives and counsel.
7.2 SURVIVAL OF SELLER'S REPRESENTATIONS AND WARRANTIES. All
representations and warranties made by the Seller to the Purchaser in this
Agreement shall survive the Closing.
7.3 NOTICES. All notices, requests, or other communications
required or permitted to be delivered hereunder shall be in writing, delivered
by registered or certified mail, return receipt requested, as follows:
(a) To the Seller: Air Products and Chemicals, Inc.
7201 Hamilton Boulevard
Allentown, PA 18195-1501
Attention: Treasurer
(b) To the Purchaser: Mellon Bank (DE) National Association
Mellon Bank Center
10th and Market Streets, 2nd Floor
Wilmington, DE 19801
Attention: Sandy S. McKenna
Assistant Vice President
Any party hereto may from time to time, by written notice given as
aforesaid, designate any other address to which notices, requests or other
communications addressed to it shall be sent.
7.4 SPECIFIC PERFORMANCE. The parties hereto acknowledge that
damages would be an inadequate remedy for any breach of the provisions of this
Agreement and agree that the obligations of the parties hereunder shall be
specifically enforceable, and neither party will take any action to impede the
other from seeking to enforce such rights or specific performance.
- 6 -
<PAGE> 7
7.5 SUCCESSORS AND ASSIGNS; INTEGRATION; ASSIGNMENT. This Agreement
shall be binding upon, inure to the benefit of and be enforceable by the
parties hereby and their respective legal representatives, successors and
assigns. This Agreement (a) constitutes, together with the Note, the Trust
Agreement and any other written agreements between the Purchaser and the Seller
executed and delivered on the date hereof, the entire agreement between the
parties hereto and supersedes all other prior agreements and understandings,
both written and oral, among the parties, with respect to the subject matter
hereof, (b) shall not confer upon any person other than the parties hereto any
rights or remedies hereunder and (c) shall not be assignable by operation of
law or otherwise except that the Trustee may assign all its rights hereunder to
any corporation or other institution exercising trust powers in connection with
any such institution assuming the duties of a trustee under the Trust.
7.6 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware.
7.7 FURTHER ASSURANCES. Subject to the terms and conditions herein
provided, each of the parties hereto agrees to use all reasonable efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective the
transactions contemplated by this Agreement.
7.8 AMENDMENT AND WAIVER. No amendment or waiver of any provision
of this Agreement or consent to departure therefrom shall be effective unless
in writing and signed by the Purchaser and the Seller.
7.9 COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the effect as if the signatures thereto were upon one
instrument.
7.10 CERTAIN LIMITATIONS. The execution delivery and performance by
the Trustee of this Agreement have been, and will be, effected by the Trustee
solely in its capacity as Trustee under the terms of the Trust and not in its
individual or corporate capacity. Nothing in this Agreement shall be
interpreted to increase, decrease or modify in any manner any liability of the
Trustee to the Seller or to any trustee representative or other claimant by
right of the Seller resulting from the Trustee's performance of its duties
under the constituent instruments of the Trust, and no personal or corporate
liability shall be asserted or enforceable against the Trustee by reason of any
of the covenants, statements or representations contained in this Agreement.
7.11 INCORPORATION. The terms and conditions of the Trust Agreement
relating to the nature of the responsibilities of the Trustee and the
indemnification of the Trustee by the Seller are incorporated herein by
reference and made applicable to this Agreement.
- 7 -
<PAGE> 8
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
on the date and year first above written.
MELLON BANK (DE) NATIONAL
ASSOCIATION, as Trustee
By: /s/ Sandy S. McKenna
-------------------------------
Name: Sandy S. McKenna
Title: Assistant Vice President
AIR PRODUCTS AND CHEMICALS, INC.
By: /s/ Gerald A. White
-------------------------------
Name: Gerald A. White
Title: Senior Vice President-Finance
- 8 -
<PAGE> 1
APPENDIX 1
PROMISSORY NOTE
$ 457,500,000.00 December 29, 1993
FOR VALUE RECEIVED, the undersigned, Mellon Bank (DE) National
Association, a national banking association with corporate trust powers under
the laws of the State of Delaware, not in its individual or corporate capacity
but solely in its capacity as Trustee of the Air Products and Chemicals, Inc.
Flexible Employee Benefits Trust (the "Trust") hereby promises on behalf of the
Trust to pay to the order of Air Products and Chemicals, Inc., a Delaware
corporation (the "Company"), at the principal offices of the Company in
Allentown, Pennsylvania or at such other place as the Company shall designate
in writing, the aggregate principal amount of Four Hundred Fifty-Seven Million
Five Hundred Thousand Dollars ($457,500,000.00), as shown on Schedule A
attached hereto as such may be amended from time to time, with interest in
arrears thereon, as hereinafter provided.
Principal shall be paid in installments in the amounts and on the
dates set forth on the Maturity Schedule attached hereto as Schedule A, the
last such installment due on September 30, 2023; provided, however, that this
Note may be prepaid in whole or in part at any time without penalty in
accordance with Section 2.2 of the Trust Agreement creating the Trust effective
as of December 29, 1993 (the "Trust Agreement"); and provided further, in
accordance with Section 2.1 and Section 2.2 of the Trust Agreement, all or any
portion of principal of this Note then outstanding, together with any accrued
but unpaid interest on this Note, may be deemed forgiven; and provided further,
in the event that the Trust shall have been terminated in accordance with
Section 8.2 of the Trust Agreement and the Trustee shall have complied with the
requirements of Section 8.3 of the Trust Agreement, any remaining principal of
this Note then outstanding, together with any accrued but unpaid interest on
this Note, shall be deemed forgiven. Interest on the unpaid principal balance,
at an annual interest rate (the "Interest Rate") equal to seven and one-half
percent (7.5%), shall be paid annually, in arrears, on each September 30,
commencing September 30, 1994, and shall be
- 1 -
<PAGE> 2
calculated on the basis of a 360-day year of twelve (12) 30-day months.
Payments received within any Trust Year (as defined in the Trust Agreement)
shall be applied first to interest accrued and unpaid as of the date of any
such payment and then, to the extent that any such payments exceed such accrued
and unpaid interest, to prepay interest that accrues after such payment through
the end of such Trust Year, and then to principal installments due within such
Trust Year, and then, to the extent not otherwise distributed in accordance
with Section 2.3 of the Trust Agreement, to installments of principal in the
order of their scheduled maturity. Whenever any payment falls due on a
Saturday, Sunday or public holiday, such payment shall be made on the next
succeeding business day. Upon termination of the Trust, the entire unpaid
balance of principal and interest shall be immediately payable.
This Note shall be construed under the laws of the State of Delaware.
The undersigned represents and warrants that the indebtedness
represented by this Note was incurred for the purpose of purchasing shares of
Common Stock, par value $1.00 per share, of the Company.
The Note may not be assigned by the Company, other than by operation
of law, without the prior express written consent of the undersigned.
The Company shall have no recourse whatsoever to any assets of the
Trustee in its individual or corporate capacity for repayment. The Trustee is
entering into this Agreement not in its individual or corporate capacity but
solely as Trustee, and no personal or corporate liability or personal or
corporate responsibilities are assumed by, or shall at any time be asserted or
enforceable against, the Trustee in its individual or corporate capacity under,
or with respect to, this Agreement.
MELLON BANK (DE) NATIONAL ASSOCIATION,
on behalf of
THE AIR PRODUCTS AND CHEMICALS, INC.
FLEXIBLE EMPLOYEE BENEFITS TRUST
By: /s/ Sandy S. McKenna
----------------------------------
Name: Sandy S. McKenna
--------------------------------
Title: Assistant Vice President
-------------------------------
- 2 -
<PAGE> 3
SCHEDULE A
PRINCIPAL PAYMENT DATES
Principal
Payment Date Principal Interest Total Annual
(September 30) Payments Payments Payments
- -------------- --------- ---------- ----------
---------- ---------- ----------
$ $ $
========== ========== ==========
- 3 -
