<PAGE> 1
Filed Pursuant to Rule 424(B)(2)
Registration No. 033-66006
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED AUGUST 13, 1993
$100,000,000
AIR PRODUCTS AND CHEMICALS, INC.
8.35% NOTES DUE 2002
------------------------
Interest on the Notes is payable on January 15 and July 15 of each year,
commencing July 15, 1995. The Notes will mature January 15, 2002. The Notes are
not redeemable prior to maturity. The Notes will be represented by one or more
global Notes registered in the name of the nominee of The Depository Trust
Company (the "DTC"). Beneficial interests in the global Notes will be shown on,
and transfers thereof will be effected only through, records maintained by the
DTC and its participants. The Notes will trade in the DTC's Same Day Funds
Settlement System until maturity, and secondary market trading activity for the
Notes will therefore settle in immediately available funds. All payments of
principal and interest will be made by the Company in immediately available
funds.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT
RELATES. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
------------------ ------------------ ------------------
<S> <C> <C> <C>
Per Note.......................... 99.988% 0.625% 99.363%
Total............................. $99,988,000 $625,000 $99,363,000
</TABLE>
---------------
(1) Plus accrued interest, if any, from January 17, 1995 to the date of
delivery.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deducting estimated expenses of $100,000 payable by the Company.
------------------------
The Notes offered hereby are offered severally by the Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to their
right to reject any order in whole or in part. It is expected that the Notes
will be ready for delivery in book-entry form only through the facilities of the
DTC in New York, New York, on or about January 17, 1995, against payment
therefor in immediately available funds.
GOLDMAN, SACHS & CO. LEHMAN BROTHERS
------------------------
The date of this Prospectus Supplement is January 10, 1995.
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVERALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
THE COMPANY
The Company, through internal development and by acquisitions, has
established an internationally recognized industrial gas and related industrial
process equipment business, and developed strong positions as a producer of
certain chemicals. In addition, the Company has developed an environmental and
energy business principally through various partnerships.
The industrial gases business segment recovers and distributes industrial
gases such as oxygen, nitrogen, argon and hydrogen and a variety of medical and
specialty gases. The chemicals business segment produces and markets specialty
chemicals and chemical intermediates. The environmental and energy business is
principally composed of partnerships in waste-to-energy, cogeneration and
flue-gas desulfurization. The equipment and technology business segment supplies
cryogenic and other process equipment and related engineering services.
The Company was incorporated in 1961 under Delaware law and is the
successor to a Michigan corporation organized in 1940. Its principal executive
offices are located at 7201 Hamilton Boulevard, Allentown, Pennsylvania
18195-1501, telephone (610) 481-4911. Except as otherwise indicated by the
context, the term "Company" as used herein means Air Products and Chemicals,
Inc., and its consolidated subsidiaries.
DESCRIPTION OF NOTES
The following description of the terms of the Notes offered hereby
(referred to in the Prospectus as the "Securities") supplements, and to the
extent inconsistent therewith replaces, insofar as such description relates to
the Notes, the description of the Securities set forth in the Prospectus, to
which description reference is hereby made.
The Notes will be limited to $100,000,000 principal amount, will be issued
in fully registered form only in denominations of $1,000 and multiples thereof,
and will mature on January 15, 2002. Principal will initially be payable, and
Notes will initially be transferable and exchangeable, at the office of The
Chase Manhattan Bank (National Association), as Trustee (the "Trustee"), at 4
Chase MetroTech Center, 3rd Floor, Brooklyn, New York 11245.
Interest on the Notes at the annual rate set forth on the cover of this
Prospectus Supplement will be payable semiannually on each January 15 and July
15, commencing on July 15, 1995.
As specified on the cover page, the Notes will be represented by one or
more global Notes (each a "Global Note") registered in the name of the nominee
of the DTC. Ownership of beneficial interests in a Global Note will be limited
to institutions that have accounts with the DTC or its nominee ("participants")
or persons that may hold interests through participants. The Company has been
advised by the DTC that upon the issuance of a Global Note and the deposit of
such Global Note with the DTC, the DTC will immediately credit, on its
book-entry registration and transfer system, the respective principal amounts of
the Notes represented by such Global Note to the accounts of participants. The
accounts to be credited shall be designated by the Underwriters.
The Company has been advised by the DTC that upon receipt of any payment of
principal of or any premium or interest in respect of a Global Note, the DTC
will immediately credit, on its book-entry registration and transfer system,
accounts of participants with payments in amounts proportionate to their
respective beneficial interests in the principal amount of such Global Note as
shown on the records of the DTC. Payments by participants to owners of
beneficial interests in a Global Note held through such participants will be
governed by standing instructions and customary
S-2
<PAGE> 3
practices, as is now the case with securities held for the accounts of customers
registered in "street name," and will be the sole responsibility of such
participants.
The DTC has advised the Company as follows: the DTC is a limited-purpose
trust company organized under the New York Banking Law, a "banking organization"
within the meaning of the New York Banking Law, a member of the Federal Reserve
System, a "clearing corporation" within the meaning of the New York Uniform
Commercial Code, and a "clearing agency" registered pursuant to the provisions
of Section 17A of the Securities Exchange Act of 1934, as amended. The DTC was
created to hold securities of its participants and to facilitate the clearance
and settlement of securities transactions, such as transfers and pledges, among
its participants in such securities through electronic computerized book-entry
changes in accounts of the participants, thereby eliminating the need for
physical movement of securities certificates. The DTC's participants include
securities brokers and dealers (including the Underwriters), banks, trust
companies, clearing corporations and certain other organizations, some of whom
(and/or their representatives) own the DTC. Access to the DTC's book-entry
system is also available to others, such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly.
The Notes may not be redeemed prior to maturity.
The provisions described in the Prospectus under "Description of
Securities -- Defeasance of the Indenture and Securities" will be applicable to
the Notes.
The Trustee acts as trustee for the Company's 8 7/8% Notes Due 2001, 8 1/2%
Debentures Due 2006, 11 1/2% Notes Due 1995, 8 3/4% Debentures Due 2021 and
6 1/4% Notes Due 2003 issued under the Indenture (as defined in the Prospectus)
and for the Company's Medium Term Notes, Series A, Medium Term Notes, Series B,
and Medium Term Notes, Series C, issued under other indentures.
USE OF PROCEEDS
The net proceeds received by the Company from the sale of the Notes offered
hereby, estimated at $99,363,000 (before deducting expenses payable by the
Company), will be used for general corporate purposes, principally to repay
outstanding commercial paper. At January 9, 1995, the Company had approximately
$230,000,000 of commercial paper outstanding, which matures no later than April
27, 1995, and bears interest at rates ranging from 5.52% to 6.45% per annum.
Pending such application, all or a portion of the net proceeds will be invested
in short-term money market instruments.
RATIOS OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
(UNAUDITED)
YEAR ENDED SEPTEMBER 30
------------------------------------------------
1990 1991 1992 1993 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C>
3.2 3.2 3.9 3.2 3.4
</TABLE>
For the purpose of determining the unaudited ratios of earnings to fixed
charges, earnings represent income (before extraordinary item and cumulative
effect of accounting changes) before income taxes, fixed charges (less interest
capitalized), amortization of capitalized interest and undistributed earnings of
less-than-fifty-percent owned affiliates. Fixed charges consist of interest on
all indebtedness (including capital lease obligations), capitalized interest,
amortization of debt discount premium and expense and the portion of rent
charges considered to be representative of the interest factor.
S-3
<PAGE> 4
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 and in accordance therewith files reports, proxy statements
and other information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other information, including
the documents incorporated herein by reference, can be inspected and copied at
the office of the Commission, at Room 1024 (Public Reference Room), 450 Fifth
Street, N.W., Washington, D.C. 20549, as well as at the Regional Offices of the
Commission at Northwestern Atrium Center, 500 West Madison Street (Suite 1400),
Chicago, Illinois 60661 and 7 World Trade Center, 13th Floor, New York, New York
10048. Copies of such material can be obtained by mail from the Public Reference
Room of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. In addition, such reports, proxy statements and other
information concerning the Company can be inspected at the offices of the New
York Stock Exchange, Inc., 20 Broad Street, New York, New York, and the Pacific
Stock Exchange, 115 Sansome Street, San Francisco, California.
UNDERWRITING
Subject to the terms and conditions set forth in the Purchase Agreement,
the Company has agreed to sell to each of the Underwriters named below, and each
of the Underwriters has severally agreed to purchase, the principal amount of
the Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
UNDERWRITER OF NOTES
--------------------------------------------------------- -------------
<S> <C>
Goldman, Sachs & Co. .................................... $ 50,000,000
Lehman Brothers Inc. .................................... 50,000,000
-------------
Total............................................... $ 100,000,000
=============
</TABLE>
Under the terms and conditions of the Purchase Agreement, the Underwriters
are committed to take and pay for all of the Notes, if any are taken.
The Underwriters propose to offer the Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus Supplement and in part to certain securities dealers at such price
less a concession of 0.375% of the principal amount of the Notes. The
Underwriters may allow, and such dealers may reallow, a concession not to exceed
0.250% of the principal amount of the Notes to certain brokers and dealers.
After the Notes are released for sale to the public, the offering price and
other selling terms may from time to time be changed.
The Notes are a new issue of securities with no established trading market.
The Company does not intend to apply for listing of the Notes on a national
securities exchange, but has been advised by the several Underwriters that they
presently intend to make a market in the Notes but are not obligated to do so
and may discontinue market making at any time without notice. No assurance can
be given as to the liquidity of the trading market for the Notes.
Settlement for the Notes will be made in immediately available funds and
all secondary trading in the Notes will settle in immediately available funds.
The Company has agreed to indemnify the several Underwriters against
certain liabilities, including liabilities under the Securities Act of 1933.
S-4
<PAGE> 5
PROSPECTUS
AIR PRODUCTS AND CHEMICALS, INC.
DEBT SECURITIES
Air Products and Chemicals, Inc. (the "Company"), directly, through agents
designated from time to time, or through dealers or underwriters also to be
designated, may sell from time to time after the date of this Prospectus up to
$250,000,000 aggregate principal amount of its debt securities (the
"Securities"), in one or more series, on terms to be determined at the time of
sale. The specific designation, aggregate principal amount, authorized
denominations, maturity, interest rate or method for its calculation, if any,
interest payment dates, purchase price, any terms for redemption, repayment or
defeasance or other specific terms, any listing on a securities exchange,
sinking fund provisions, if any, and the agents, dealers or underwriters, if
any, in connection with the sale of the Securities in respect of which this
Prospectus is being delivered are set forth in the accompanying Prospectus
Supplement ("Prospectus Supplement") together with the terms of offering of the
Securities. The Company reserves the sole right to accept and, together with its
agents from time to time, to reject in whole or in part any proposed purchase of
Securities to be made directly or through agents.
------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------
If an agent of the Company or a dealer or underwriter is involved in the
sale of the Securities in respect of which this Prospectus is being delivered,
the agent's commission, dealer's purchase price or underwriter's discount is set
forth in, or may be calculated from, the Prospectus Supplement and the net
proceeds to the Company from such sale will be the purchase price of such
Securities less such commission in the case of an agent, the purchase price of
such Securities in the case of a dealer or the public offering price less such
discount in the case of an underwriter, and less, in each case, the other
attributable issuance and distribution expenses. The aggregate proceeds to the
Company from all the Securities will be the purchase price of Securities sold
less the aggregate of agents' commissions and underwriters' discounts and other
expenses of issuance and distribution. See "Plan of Distribution" for possible
indemnification arrangements for the agents, dealers and underwriters.
------------------
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
August 13, 1993
<PAGE> 6
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 and in accordance therewith files reports, proxy statements
and other information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other information, including
the documents incorporated herein by reference, can be inspected and copied at
the office of the Commission at Room 1024 (Public Reference Room), 450 Fifth
Street, N.W., Washington, D.C. 20549, as well as at the Regional Offices of the
Commission at Northwestern Atrium Center, 500 West Madison Street (Suite 1400),
Chicago, Illinois 60661 and 7 World Trade Center, 13th Floor, New York, New York
10048. Copies of such material can be obtained by mail from the Public Reference
Room of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. In addition, such reports, proxy statements and other
information concerning the Company can be inspected at the offices of the New
York Stock Exchange, Inc., 20 Broad Street, New York, New York, and the Pacific
Stock Exchange, 115 Sansome Street, San Francisco, California.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference in this Prospectus the
following documents:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
September 30, 1992, filed pursuant to Section 13 of the Securities Exchange Act
of 1934; and
(b) The Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended December 31, 1992, and March 31, 1993, filed pursuant to Section 13 of the
Securities Exchange Act of 1934.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 subsequent to the date of this
Prospectus and prior to the termination of the offering of the Securities shall
be deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Any person receiving a copy of this Prospectus may obtain without charge,
upon written or oral request, a copy of any of the documents incorporated by
reference herein, except for the exhibits to such documents. Requests should be
directed to the Corporate Secretary's Office, Air Products and Chemicals, Inc.,
7201 Hamilton Boulevard, Allentown, Pennsylvania 18195-1501, telephone: (610)
481-4911.
THE COMPANY
The Company, through internal development and by acquisitions, has
established an internationally recognized industrial gas and related industrial
process equipment business, and developed strong positions as a producer of
certain chemicals. In addition, the Company has developed an environmental and
energy business principally through various partnerships.
The industrial gases business segment recovers and distributes industrial
gases such as oxygen, nitrogen, argon and hydrogen and a variety of medical and
specialty gases. The chemicals business segment produces and markets specialty
chemicals and chemical intermediates. The environmental and energy business is
principally composed of partnerships in waste-to-energy, cogeneration and flue-
gas desulfurization. The equipment and technology business segment supplies
cryogenic and other process equipment and related engineering services.
2
<PAGE> 7
The Company was incorporated in 1961 under Delaware law and is the
successor to a Michigan corporation organized in 1940. Its principal executive
offices are located at 7201 Hamilton Boulevard, Allentown, Pennsylvania
18195-1501, telephone (610) 481-4911. Except as otherwise indicated by the
context, the term "Company" as used herein means Air Products and Chemicals,
Inc., and its consolidated subsidiaries.
RATIOS OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS
(UNAUDITED) ENDED
YEAR ENDED SEPTEMBER 30, MARCH 31,
----------------------------------------- --------------
1988 1989 1990 1991 1992 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
3.9 3.6 3.2 3.2 3.9 4.2
</TABLE>
For the purpose of determining the unaudited ratios of earnings to fixed
charges, earnings represent income (before extraordinary item) before income
taxes, fixed charges (less interest capitalized), amortization of capitalized
interest and dividends received in excess of earnings of less-than-fifty-percent
owned affiliates. Fixed charges consist of interest on all indebtedness
(including capital lease obligation), capitalized interest, amortization of debt
discount premium and expense and the portion of rent charges considered to be
representative of the interest factor.
USE OF PROCEEDS
The Company currently intends to apply the net proceeds from the sale of
the Securities to its general funds to be used for general corporate purposes,
including the repayment of commercial paper obligations. Pending such
application, all or a portion of the net proceeds may be invested in short-term
money market instruments. The precise amount and timing of the use of the
proceeds will depend upon future requirements and the availability of other
funds to the Company.
DESCRIPTION OF SECURITIES
The Securities offered hereby will be issuable in one or more series under
an Indenture dated as of January 18, 1985, as amended as of July 15, 1993 (the
"Indenture"), entered into between the Company and The Chase Manhattan Bank
(National Association), as Trustee (the "Trustee"). The following statements are
subject to the detailed provisions of the Indenture, a copy of which is filed as
an exhibit to the Registration Statement. Wherever references are made to
particular provisions of the Indenture, such provisions are incorporated by
reference as a part of the statements made and such statements are qualified in
their entirety by such reference. Certain defined terms are capitalized.
References in italics are to the Indenture.
GENERAL
The Indenture provides that the aggregate principal amount of Securities
which may be issued under the Indenture is unlimited. Reference is made to the
Prospectus Supplement for the following terms of the Securities in respect of
which this Prospectus is being delivered: (1) the designation, aggregate
principal amount and authorized denominations of such Securities; (2) the
percentage of their principal amount at which such Securities will be issued;
(3) the date on which such Securities will mature; (4) the rate or rates per
annum, if any, at which such Securities will bear interest or the method for
calculating such rate; (5) the times at which such interest, if any, will be
payable; (6) provisions for a sinking fund, if any; (7) whether such Securities
are to be issued in book-entry form, and, if so, the identity of the depositary
and information with respect to book-entry procedures; and (8) any redemption,
repayment or defeasance terms or other specific terms. Principal and interest,
if any, will be payable, and the Securities offered hereby will be transferable
or exchangeable, as provided therein.
3
<PAGE> 8
The Securities will be unsecured and will rank on a parity with all other
unsecured and unsubordinated indebtedness of the Company.
One or more series of the Securities may be issued as discounted Securities
(bearing no interest or interest at a rate which at the time of issuance is
below market rates) to be sold at a substantial discount below their stated
principal amount. Federal income tax consequences and other special
considerations applicable to any such series of discounted Securities will be
described in the Prospectus Supplement relating thereto.
The Securities offered hereby will be issued only in fully registered form
without coupons. No service charge will be made for any transfer or exchange of
the Securities, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith. (Section
2.8)
CERTAIN COVENANTS OF THE COMPANY
Limitations on Liens -- Subject to the exceptions set forth below under
"Exempted Indebtedness", the Company covenants that it will not create or
assume, nor will it permit any Restricted Subsidiary (as hereinafter defined) to
create or assume, any lien on any Principal Property (as hereinafter defined) or
shares of capital stock or indebtedness of any Restricted Subsidiary, whether
owned at the date of the Indenture or thereafter acquired, without equally and
ratably securing the outstanding Securities. This restriction will not apply to
certain permitted liens, including the following: (1) liens on any Principal
Property which are created or assumed contemporaneously with, or within 120 days
after (or in the case of any such Principal Property which is being financed on
the basis of long-term contracts or similar financing arrangements for which a
firm commitment is made by one or more banks, insurance companies or other
lenders or investors (not including the Company or any Restricted Subsidiary),
then within 360 days after), the completion of the acquisition, construction or
improvement of such Principal Property to secure or provide for the payment of
any part of the purchase price of such property or the cost of such construction
or improvement, or liens on any Principal Property existing at the time of
acquisition thereof; (2) liens on property or shares of capital stock or
indebtedness of a corporation existing at the time such corporation is merged
into or consolidated with the Company or a Restricted Subsidiary or at the time
of a sale, lease or other disposition of the properties of a corporation
substantially as an entirety to the Company or a Restricted Subsidiary; (3)
liens on property or shares of capital stock or indebtedness of a corporation
existing at the time such corporation becomes a Restricted Subsidiary; (4) liens
to secure indebtedness of a Restricted Subsidiary to the Company or to another
Restricted Subsidiary, but only so long as such indebtedness is held by the
Company or a Restricted Subsidiary; (5) liens in favor of the United States of
America or any state, or any department, agency or political subdivision
thereof, to secure certain payments pursuant to any contract or statute,
including liens to secure indebtedness of the pollution control or industrial
revenue bond type, or to secure indebtedness incurred for the purpose of
financing all or any part of the purchase price or cost of constructing or
improving property subject to such liens; (6) liens in favor of any customer
arising in respect of certain payments made by or on behalf of such customer for
goods produced for or services rendered to such customer in the ordinary course
of business not exceeding the amount of such payments; (7) liens to extend,
renew or replace in whole or in part any lien referred to in the foregoing
clauses (1) to (6), or in this clause (7), or any lien created prior to and
existing on the date of the Indenture, provided that the principal amount of
indebtedness secured thereby shall not exceed the principal amount of
indebtedness so secured at the time of such extension, renewal or replacement,
and that such extension, renewal or replacement shall be limited to all or a
part of the property subject to the lien so extended, renewed or replaced (plus
improvements on such property); and (8) certain statutory liens, liens for taxes
and certain other liens. (Section 3.6)
Limitations on Sale and Lease-Back Transactions -- Subject to the
exceptions set forth below under "Exempted Indebtedness", sale and lease-back
transactions by the Company or any Restricted Subsidiary of any Principal
Property which has been owned and operated by the Company or a
4
<PAGE> 9
Restricted Subsidiary for more than 120 days are prohibited unless (1) the
property involved is property which could be the subject of a lien without
equally and ratably securing the Securities; (2) an amount equal to the
Attributable Debt (as hereinafter defined) of any such sale and lease-back
transaction is applied to the acquisition of another Principal Property of equal
fair market value or to retirement of indebtedness for borrowed money (including
the Securities) which by its terms matures on or is renewable at the option of
the obligor to a date more than twelve months after the creation of such
indebtedness; or (3) the lease involved is for a term (including renewals) of
not more than three years. (Section 3.7)
Exempted Indebtedness -- The Company or a Restricted Subsidiary may create
or assume liens and enter into sale and lease-back transactions, notwithstanding
the limitations outlined above, provided that at the time thereof and after
giving effect thereto the aggregate amount of indebtedness secured by all such
liens and Attributable Debt of all such sale and lease-back transactions
outstanding shall not exceed 5% of Consolidated Net Tangible Assets (as
hereinafter defined). (Section 3.8)
Limitations on Mergers, Consolidations and Sales of Assets -- If, upon any
consolidation or merger of the Company with or into any other corporation, or
upon any sale, conveyance or lease of substantially all its properties, any
Principal Property would thereupon become subject to any lien, the Company,
prior to such event, will secure the Securities equally and ratably with any
other obligations of the Company then entitled thereto by a direct lien on all
such Principal Property prior to all other liens other than any theretofore
existing thereon. (Section 3.9)
Certain Definitions -- The term "Subsidiary" means any corporation of which
at least a majority of all outstanding voting stock is at the time owned by the
Company or by one or more Subsidiaries or by the Company and one or more
Subsidiaries. The term "Restricted Subsidiary" means any Subsidiary (a)
substantially all of the property of which is located, or substantially all of
the business of which is carried on, within the United States and (b) which owns
or leases a Principal Property. The term "Principal Property" means any
manufacturing plant, research facility or warehouse owned or leased by the
Company or any Subsidiary which is located within the United States and has a
net book value exceeding 1% of shareholders' equity of the Company and its
consolidated Subsidiaries excluding any property which the Board of Directors by
resolution declares is not of material importance to the total business of the
Company and its Subsidiaries as an entirety. The term "Attributable Debt" means
the present value (discounted as provided in the Indenture) of the obligation of
a lessee for required rental payments for the remaining term of any lease. The
term "Consolidated Net Tangible Assets" means at any time the total of all
assets appearing on the most recent consolidated balance sheet of the Company
and its consolidated Subsidiaries, prepared in accordance with generally
accepted accounting principles, at their net book values (after deducting
related depreciation, depletion, amortization and all other valuation reserves
which, in accordance with such principles, should be set aside in connection
with the business conducted), but excluding goodwill, trademarks, patents,
unamortized debt discount and all other like segregated intangible assets, and
amounts on the asset side of such balance sheet for capital stock of the
Company, all as determined in accordance with such principles, less Consolidated
Current Liabilities. The term "Consolidated Current Liabilities" means the
aggregate of the current liabilities of the Company and its consolidated
Subsidiaries appearing on the consolidated balance sheet of the Company and its
consolidated Subsidiaries, all as determined in accordance with generally
accepted accounting principles. (Section 1.1)
EVENTS OF DEFAULT, WAIVER AND NOTICE
As to any series of Securities, an Event of Default is defined in the
Indenture as being any one of the following events and events as may be
established with respect to the Securities of such series in any applicable
Pricing Supplement: (a) default for 30 days in the payment of any interest on
the Securities of such series; (b) default in the payment of principal and
premium, if any, on the Securities of such series when due either at maturity,
upon redemption, by declaration or otherwise; (c) default in the payment of any
sinking fund installment on the Securities of such series; (d) default by the
Company in the performance of any other of the covenants or agreements in the
Indenture (other
5
<PAGE> 10
than those set forth exclusively in the terms of any series of Securities) which
shall not have been remedied for a period of 90 days after appropriate notice;
or (e) certain events of bankruptcy, insolvency and reorganization of the
Company. (Section 5.1) No Event of Default with respect to any particular series
of Securities necessarily constitutes an Event of Default with respect to any
other series of Securities. The Indenture provides that the Trustee may withhold
notice to the holders of Securities of any series of any default (except in
payment of principal of or interest on such Securities or in the making of any
sinking fund payment with respect to such Securities) if the Trustee considers
it in the interest of the holders of Securities of such series to do so.
(Section 5.11)
The Indenture provides that: (1) if an Event of Default described in clause
(a), (b) or (c) above or established with respect to the Securities of any
series shall have occurred and be continuing, either the Trustee or the holders
of 25% in principal amount of the Securities of such series then outstanding may
declare the principal (or, in the case of discounted Securities, the amount
specified in the terms thereof) of all such Securities to be due and payable
immediately and (2) if an Event of Default described in clause (d) or (e) above
shall have occurred and be continuing, either the Trustee or the holders of not
less than 25% in principal amount of all Securities then outstanding may declare
the principal (or, in the case of discounted Securities, the amount specified in
the terms thereof) of all Securities to be due and payable immediately, but upon
certain conditions such declarations may be annulled and past defaults (except
for defaults in the payment of principal of, or premium or interest, if any, on,
such Securities) may be waived by the holders of a majority in principal amount
of the Securities of such series (or of all series as the case may be) then
outstanding. (Section 5.1 and Section 5.10)
The holders of a majority in aggregate principal amount of the Securities
of each series affected (with each series voting as a separate class) and then
outstanding shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee under the
Indenture, subject to certain limitations specified in the Indenture, provided
that the holders of Securities shall have offered to the Trustee reasonable
indemnity against expenses and liabilities. (Section 5.9 and Section 6.2(d)) The
Indenture requires the annual filing by the Company with the Trustee of a
certificate as to the absence of certain defaults under the Indenture. (Section
3.5)
Other than the restrictions on liens and sale and lease-back transactions
described above, the Indenture and the Securities do not contain any covenants
or other provisions designed to afford holders of the Securities protection in
the event of a highly leveraged transaction involving the Company or any
Subsidiary.
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of not less than 66 2/3% in aggregate principal
amount of the Securities of all series affected by such modification at the time
outstanding (voting as one class), to modify the Indenture or any supplemental
indenture or the rights of the holders of the Securities, provided that no such
modification shall (i) extend the final maturity of any Security, or reduce the
principal amount thereof, or reduce the rate or extend the time of payment of
interest thereon, or reduce any amount payable upon redemption thereof, or
reduce the amount of the principal of a discounted Security due and payable upon
acceleration of the maturity thereof or provable in bankruptcy, or impair or
affect the right of a holder to institute suit for the payment thereof or the
right of repayment, if any, at the option of the holder thereof, without the
consent of the holder of each Security so affected, or (ii) reduce the aforesaid
percentage of Securities of any series, the consent of the holders of which is
required for any such modification, without the consent of the holder of each
Security so affected. (Section 8.2)
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<PAGE> 11
GLOBAL SECURITIES
The Securities of a series may be issued in the form of a global security
which is deposited with and registered in the name of the depositary (or a
nominee of the depositary) specified in the accompanying Prospectus Supplement.
So long as the depositary for a global security, or its nominee, is the
registered owner of the global security, the depositary or its nominee, as the
case may be, will be considered the sole owner or holder of the Securities
represented by such global security for all purposes under the Indenture. Except
as provided in the Indenture, owners of beneficial interests in Securities
represented by a global security will not (a) be entitled to have such
Securities registered in their names, (b) receive or be entitled to receive
physical delivery of certificates representing such Securities in definitive
form, (c) be considered the owners or holders thereof under the Indenture and
(d) have any rights under the Indenture with respect to such global security
(Section 2.13). The Company, in its sole discretion, may at any time determine
that any series of Securities issued or issuable in the form of a global
security shall no longer be represented by such global security and such global
security shall be exchanged for securities in definitive form pursuant to the
Indenture (Section 2.13).
Upon the issuance of a global security, the depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
such global security to the accounts of participants in the depositary.
Ownership of beneficial interests in a global security will be shown on, and the
transfer of that ownership will be effected only through, records maintained by
the depositary (with respect to interests of participants in the depositary), or
by participants in the depositary or persons that may hold interests through
such participants (with respect to persons other than participants in the
depositary). Ownership of beneficial interests in a global security will be
limited to participants or persons that hold interests through participants.
CONCERNING THE TRUSTEE
The Chase Manhattan Bank (National Association), the Trustee under the
Indenture, has extended credit facilities to, and performs other services for,
the Company in the normal course of business. The Chase Manhattan Bank (National
Association) acts as trustee for the Company's Medium-Term Notes, Series A, and
Medium-Term Notes, Series B, issued under another indenture and for the
Company's 11 1/2% Notes Due 1995, 8 1/2% Debentures Due 2006, 8 7/8% Notes Due
2001, 8 3/4% Debentures Due 2021 and 6 1/4% Notes Due 2003 issued under the
Indenture.
DEFEASANCE OF THE INDENTURE AND SECURITIES
The Company at any time may satisfy its obligations with respect to
payments of principal of, premium, if any, and interest, if any, on, any
Security or Securities of any series by depositing in trust with the Trustee
cash or U.S. Government Obligations (as defined in the Indenture) or a
combination thereof sufficient to make such payments when due. If such deposit
is sufficient to make all payments of (1) interest, if any, on such Securities
prior to and on their redemption or maturity, as the case may be, and (2)
principal of, and premium, if any, on such Securities when due upon redemption
or at maturity, as the case may be, all the obligations of the Company with
respect to such Securities and the Indenture insofar as it relates to such
Securities will be discharged and terminated (except as to the Company's
obligations to compensate, reimburse and indemnify the Trustee pursuant to the
Indenture). In the event of any such defeasance, holders of such Securities
would be able to look only to such trust fund for payment of principal and
premium, if any, and interest, if any, on Securities of such series until
maturity or redemption. (Article Ten)
For federal income tax purposes, there is a substantial risk that any
deposit of cash and/or U.S. Government Obligations with respect to which the
Company shall have elected to satisfy and fully discharge its obligations with
respect to any series of Securities could be treated as a taxable exchange of
such Securities for interests in the trust (or, alternatively, for an instrument
representing indebtedness of the trust). In that event, a holder could be
required to recognize taxable gain or loss at the
7
<PAGE> 12
time of such defeasance as if the Securities had been sold for an amount equal
to the sum of the amount of money and the fair market value of the U.S.
Government Obligations held in the defeasance trust (or, alternatively, the
value of the instrument). Thereafter, a holder might be required to include in
income the holder's share of the income, gain and loss of the trust (or,
alternatively, the trust might be considered a separate taxable entity with
respect to such items and with respect to the debt instrument, in which case a
holder might also be taxable on original issue discount as well as interest on
the instrument). Purchasers of the Securities should consult their own advisors
with respect to the more detailed tax consequences to them of such deposit and
discharge, including the applicability and effect of tax laws other than federal
income tax law.
PLAN OF DISTRIBUTION
The Company may sell the Securities in any of four ways: (i) directly to
purchasers; (ii) through agents; (iii) through underwriters; or (iv) through
dealers.
Offers to purchase Securities may be solicited directly by the Company or
by agents designated by the Company from time to time. Any such agent, who may
be deemed to be an underwriter as that term is defined in the Securities Act of
1933, involved in the offer or sale of the Securities in respect of which this
Prospectus is delivered will be named, and any commissions payable by the
Company to such agent will be set forth, in the Prospectus Supplement. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a best efforts basis for the period of its appointment. Agents may be
customers of, engage in transactions with or perform services for the Company in
the ordinary course of business.
If an underwriter or underwriters are utilized in the sale, the Company
will execute an underwriting agreement with such underwriters at the time of
sale to them and the names of the underwriters and the terms of the transaction
will be set forth in the Prospectus Supplement, which will be used by the
underwriters to make resales of the Securities in respect of which this
Prospectus is delivered to the public.
If a dealer is utilized in the sale of the Securities in respect of which
this Prospectus is delivered, the Company will sell such Securities to such
dealer, as principal. The dealer may then resell such Securities to the public
at varying prices to be determined by such dealer at the time of resale.
Agents, underwriters and dealers may be entitled under the relevant
agreements to indemnification by the Company against certain liabilities,
including liabilities under the Securities Act of 1933.
If so indicated in the Prospectus Supplement, the Company will authorize
agents or underwriters to solicit offers by certain institutions to purchase
Securities from the Company at the public offering price set forth in the
Prospectus Supplement pursuant to Delayed Delivery Contracts ("Contracts")
providing for payment and delivery on the date stated in the Prospectus
Supplement. Each Contract will be for an amount not less than, and unless the
Company otherwise agrees the aggregate principal amount of Securities sold
pursuant to Contracts shall be not more than, the respective amounts stated in
the Prospectus Supplement. Institutions with which Contracts, when authorized,
may be made include commercial and savings banks, insurance companies, pension
funds, investment companies, educational and charitable institutions and other
institutions but shall in all cases be subject to the approval of the Company.
Contracts will not be subject to any conditions except that the purchase by an
institution of the Securities covered by its Contract shall not at the time of
delivery be prohibited under the laws of any jurisdiction in the United States
to which such institution is subject. A commission indicated in the Prospectus
Supplement will be paid to underwriters or agents soliciting purchases of
Securities pursuant to Contracts accepted by the Company.
The place and time of delivery for the Securities in respect of which this
Prospectus is delivered will be set forth in the Prospectus Supplement.
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<PAGE> 13
LEGAL OPINIONS
The legality of the Securities in respect of which this Prospectus is being
delivered will be passed on for the Company by James H. Agger, Esq., Vice
President, General Counsel and Secretary of the Company, or Robert F. Gerkens,
Esq., Assistant General Counsel -- Corporate of the Company, and for the
underwriters, if any, by Cravath, Swaine & Moore, 825 Eighth Avenue, New York,
New York 10019. Messrs. Agger and Gerkens, in their capacities indicated, are
paid salaries by the Company, they are participants in various employee benefit
plans offered to employees of the Company generally and each owns and has
options to purchase shares of common stock of the Company. Cravath, Swaine &
Moore from time to time acts as special counsel for the Company.
EXPERTS
The financial statements and the related supporting schedules included or
incorporated by reference in the Company's Annual Report on Form 10-K for the
year ended September 30, 1992, have been audited by Arthur Andersen & Co.,
independent public accountants, as indicated in their reports with respect
thereto, and are incorporated herein by reference in reliance upon the reports
of said firm and upon the authority of said firm as experts in accounting and
auditing.
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<PAGE> 14
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS
SUPPLEMENT OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL.
NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY
SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE
THE DATE HEREOF OR THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PAGE
<TABLE>
<S> <C>
The Company........................... S-2
Description of Notes.................. S-2
Use of Proceeds....................... S-3
Ratios of Earnings to Fixed Charges... S-3
Available Information................. S-4
Underwriting.......................... S-4
</TABLE>
PROSPECTUS
<TABLE>
<S> <C>
Available Information................. 2
Incorporation of Certain Documents by
Reference........................... 2
The Company........................... 2
Ratios of Earnings to Fixed Charges... 3
Use of Proceeds....................... 3
Description of Securities............. 3
Plan of Distribution.................. 8
Legal Opinions........................ 9
Experts............................... 9
</TABLE>
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$100,000,000
AIR PRODUCTS AND
CHEMICALS, INC.
8.35% NOTES
DUE 2002
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[LOGO]
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GOLDMAN, SACHS & CO.
LEHMAN BROTHERS
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